In the early hours of Monday, Bitcoin regained upward momentum, briefly breaking through the $106,000 mark, before encountering resistance and experiencing a slight pullback. As of this writing, Bitcoin is trading at $104,153, having dropped 1% in the past 24 hours.
Despite some decline, the asset overall maintains strong momentum, having recorded significant increases in recent weeks and approaching historical highs. Previously, Bitcoin's price experienced a brief consolidation phase late last week before retreating after breaking through $104,000.
Against this price performance, CryptoQuant analyst Avocado Onchain recently shared his interpretation of the trend based on derivatives and spot market data.
Market buying volume and financing rates show a shift in rebound behavior.
Avocado Onchain pointed out in his recent analysis 'The Bitcoin rebound has not overheated, which is a clear sign of a healthy bull market' that Bitcoin's behavior changed near key price milestones.
He pointed out that in past breakout attempts, Bitcoin's surge to historical highs often accompanied significant increases in Binance market buying volume and financing rates, both of which signal an overheated market. These situations typically lead to short-term pullbacks as traders lock in profits and unwind leverage.
However, the analyst observed that the current rebound is unfolding differently. Binance's financing rates remain stable, and market buying volume is on a downward trend, which Avocado interprets as a sign of restraint rather than weakness.
He believes that unlike the dramatic speculative rebounds seen in previous phases, the current environment reflects cautious optimism and ongoing accumulation. He thinks this more moderate recovery may be less susceptible to sudden pullbacks and instead support a more stable path towards potential new highs.
📋 A Bitcoin rebound without overheating is a clear sign of a healthy bull market.
In the previous season, Bitcoin experienced a significant rise, followed by a similar adjustment period due to overheating...
— Avocado (@avocado_onchain) May 19, 2025
On-chain trends for Bitcoin indicate that it will continue to accumulate.
Avocado emphasizes that although purchasing activity has not surged at the same pace as in previous times, the overall trend of market purchases has been gradually increasing since 2023. He mentioned that on-chain data shows a sustained upward trend, indicating that long-term investor interest remains unchanged.
As market sentiment continues to recover from recent adjustments, and the overheating in the derivatives market has eased, he believes that the current market structure favors more upward momentum in the near to mid-term.
While this analyst did not specifically predict when Bitcoin would break previous records, he emphasized that the current market conditions do not resemble previous overheating peaks. He noted that if this trend continues, it would create a more constructive market environment and potentially lead to more sustainable gains.
