The current market setup is approaching an inflection point where bulls will have to step up.
From a technical perspective, Bitcoin [BTC] The 2.57% rally on April 17 pushed the price back above $76,000, with the upper wick reaching $78,000, a level that BTC has not tested in over 70 days.
With trading about 4% below the $80,000 mark, pressure on the chain is starting to increase.
As shown in the chart below, BTC rebounded perfectly from the realized price of the cohort of 18 million up to 2-year long-term holders (LTH), close to $62,000.
In fact, the price has now risen above the cost basis of the short-term holder (STH) cohort of $1 million to $3 million, at around $75,620. However, this remains an important area where supply tends to increase.
The logic is simple: STHs are usually the first to sell once Bitcoin trades above their cost basis, locking in profits.
And this time, even though BTC is only about 2.6% above this level, the continued profit-taking suggests that traders are already positioning themselves for potential overhead resistance near the $80k area.
In this environment, many market participants prefer to safeguard gains rather than risk a pullback that could hit earnings.
For the rally to maintain strength, the bulls must now absorb this selling pressure; Otherwise, momentum could stall before BTC has a good chance at a $80,000 breakout.
Interestingly, the timing couldn’t be better for Bitcoin bulls.
Rising Bitcoin shorts could put pressure on the price towards $80,000
As realized profits continue to pile up, betting on the downside of Bitcoin seems like a logical move.
Bitcoin’s technical design in particular also supports this story. On the daily chart, BTC’s RSI has risen to a three-month high, approaching the 75 level.
This move comes after Bitcoin’s nearly 10% rally from the $70k level, when the RSI was in a neutral zone. Simply put, BTC is now moving into overbought territory, a sign of strong momentum, but also a situation that increases the risk of a short-term cooldown.
At the same time, Bitcoin shorts appear to be becoming more aggressive. As shown in the chart below, BTC funding rates remain deeply negative.
In fact, negative funding rates rose by almost 400%, from −0.003 the day before to −0.0148 on April 17, just as BTC rose about 2.5% towards $78,000.
All things considered, an overbought RSI, short-term holders locking in gains, and persistently negative funding rates explain the setup why betting on Bitcoin’s downside currently seems reasonable, with bears expecting resistance before a clean move above $80,000.
However, if the bulls step in and absorb the selling pressure, this same setup can quickly turn into a bear trap.
From an institutional perspective, more than $650 million has recently been invested in Bitcoin ETFs, with BlackRock’s IBIT accounting for nearly 45% of total inflows.
This indicates a positive Coinbase Premium Index (CPI). bid support is still present among the market. If risk appetite remains strong, it seems increasingly likely for a short squeeze that BTC will breach $80,000 for now.
Final summary
- Rising profit-taking and aggressive shorting puts Bitcoin at a key inflection point near $80,000 resistance.
- Strong ETF inflows and underlying bid support could turn bearish positioning into a short-squeeze-induced breakout.