Simply put
- Bitcoin has bounced back from a trough of $99,600 to around $103,400, although 28% of its supply is still showing losses.
- Opinions among analysts are mixed; some see this as a significant buy signal, while others caution about a potential pullback.
- This shift comes after the head of research at Galaxy Digital revised his end-of-year Bitcoin price forecast from $185,000 down to $120,000.
Cryptocurrency markets are cautiously hinting at recovery after a sharp sell-off, leaving traders facing some serious uncertainties.
The recent bull market has seen Bitcoin rise from Wednesday’s low of $99,600 to its current trading level of approximately $103,400, according to CoinGecko data.
But is this a genuine start to a lasting recovery, or just a brief pause before more declines?
“Bitcoin liquidity is starting to recover,” noted on-chain analyst Willy Wu, who mentioned on Twitter that we might see price confirmation in the next couple of weeks.
Currently, Bitcoin is roughly 25% lower than its high in October, with about 28.1% of the supply in the red, according to CryptoQuant.
Historically, supply reductions like this often precede price rebounds. For instance, in April 2025, supply losses reached 27% before Bitcoin surged by 70%. Fast forward to September 2024, and we saw a whopping 125% increase.
However, some analysts are concerned that this recovery doesn’t exhibit the traits of a true rebound.
Sean Young, a principal analyst at MEXC Research, pointed out, “What we’re observing now is a rally driven by technicals, which depends on spot inflows and short-covering. It doesn’t necessarily signify a long-term resurgence in confidence.”
Young added that for this rally to mark a real bottom, consistent accumulation by long-term holders and stable funding rates are essential.
While the recent uptick might seem like strong bullish interest, it hasn’t yet indicated a full recovery, he cautioned.
On the bullish side, analysts note that the $100,000 mark could serve as a key accumulation area to support a medium-term recovery into 2026, according to Jiehan Chen from Schroders. He emphasized that the weekly close should remain above $103,000.
Conversely, for the bears, this rally is simply another bear market bounce in a cooling cycle. Analysts suggest that if this trend persists, the buy range might shift between $93,000 and $88,000.
The recent downturn has led Alex Thorne, the research head at Galaxy Digital, to revise his Bitcoin year-end target downwards, reflecting diminished expectations after the latest sell-off.
A significant factor that could alter this outlook is the broader economic context. Chen believes volatility is likely to continue unless positive developments, like resolving the government shutdown, reshape the economic landscape.
