In brief
- Bitcoin bounced to $103,400 from a $99,600 low, with 28% of supply now held at a loss.
- Analysts are split: some see a historic buy signal, others warn it’s a technical bounce.
- It comes as Galaxy Digital’s head of research has lowered his year-end Bitcoin price target from $185,000 to $120,000.
The crypto market is showing tentative signs of a recovery following a bruising sell-off, leaving traders grappling with a critical question.
The upward swing saw Bitcoin bounce from Wednesday’s intraday low of $99,600 to trade around $103,400, according to CoinGecko data.
But is it the start of a sustainable rebound or a temporary respite before further declines?
“Liquidity behind Bitcoin is starting to make a recovery,” on-chain analyst Willy Woo wrote in a tweet on Wednesday, suggesting that a price confirmation could follow in two weeks.
Bitcoin has shed roughly 25% from its October peak, pushing the supply of coins held at a loss to 28.1%, CryptoQuant data shows.
Historical data show that such supply losses have often preceded price reversals. A spike in this metric to 27% in April 2025 preceded a 70% rally in Bitcoin. Back in September 2024, it kicked off a 125% surge.
Still, some analysts caution that the current bounce lacks the hallmarks of a proper recovery.
“What we are looking at right now is a technically driven rebound, being supported by spot inflows and leveraged short-covering,” Shawn Young, Chief Analyst at MEXC Research, told Decrypt. “So it’s not necessarily a resurgence of long-term conviction.”
The market needs to see consistent on-chain accumulation by long-term holders and stabilized funding rates for this bounce to become an enduring bottom, Young said.
“The recent relief bounce could come across as active dip-buying, but it is not yet eligible to be considered a full-scale recovery signal,” Young added.
For bulls, the $100,000 zone is forming as a potential accumulation range that could fuel a mid-term recovery into 2026, Jiehan Chen, Operations Onboarding Lead Analyst at Schroders, told Decrypt. The weekly candlestick close needs to hold above $103,000, he said.
For bears, the current uptick is a standard bear market bounce within a cooling cycle. If the trend persists, the dip buying zone could extend from $93,000 to $88,000, experts previously told Decrypt.
The recent drop has also caused Alex Thorn, head of research at crypto investment and infrastructure company Galaxy Digital, to lower his end-of-year target for Bitcoin from $185,000 to $120,000, signaling tempered expectations after the recent selloff.
The deciding factor or pivotal catalyst that could put this outlook on its head is the macro backdrop. Chen expects a period of choppiness ahead unless a positive catalyst, like an end to the government shutdown, changes the underlying economic outlook.
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