Bitcoin (BTC) has continued to rise for seven consecutive weeks, breaking significantly above $100,000. However, new signals warn that this upward movement may soon come to an end.
It is difficult to precisely predict the moment of price reversal for BTC. However, some signs indicate an increase in risks.
Profit-taking could end the 7-week rally.
The first noticeable sign is that large holders of Bitcoin have stopped accumulating and started selling their coins. Glassnode data confirms this trend. In May, the accumulation index for wallets with more than 10,000 BTC fell from 0.8 to below 0.5. This is evident from the change in color from blue to orange.
Profit-taking could end the 7-week rally.
The first noticeable sign is that large holders of Bitcoin have stopped accumulating and started selling their coins. Glassnode data confirms this trend. In May, the accumulation index for wallets with more than 10,000 BTC fell from 0.8 to below 0.5. This is evident from the change in color from blue to orange.
Additionally, wallets with a balance of 1 to 10,000 BTC show weaker accumulation. This is evident from the disappearance of blue shades. Only wallets with a balance of less than 1 BTC show a clear shift from selling to active accumulation, triggered by reaching a new ATH for Bitcoin.
These data show that large investors tend to lock in profits. At the same time, small retail investors seem to be influenced by FOMO (fear of missing out) and are eager to take advantage of short-term opportunities.
Another risk factor for BTC
Another alarming signal comes from unspent transaction outputs (UTXO). UTXO is a mechanism that ensures each Bitcoin can be spent only once in the blockchain. They also allow for the assessment of unrealized profits across all unspent BTC.
CryptoQuant data show that when 99% of UTXO are in profit, it usually signals market overheating. Historically, such phases often precede price corrections. Regardless of whether the correction is short-term or long-term, this signal indicates an increasing risk for buyers.
At the moment, there are no clear signs of a correction. Many experts remain optimistic about Bitcoin.
Thus, short-term indicators may suggest a pullback from current highs. However, they seem not to affect broader analyst expectations for this year and next.