Bitcoins [BTC] The recovery to $73,000 reflects a cooling of aggressive selling pressure rather than a revival of broad market demand.
Still, the Bull Score Index remained around 10 at the time of writing. This shows that overall network participation remains weak.
Earlier in the cycle, Bitcoin rose from around $60,000 to above $120,000, while the Bull Score repeatedly climbed above 60. During that period, capital inflows, derivatives expansion and spot demand aligned to support the rally.
However, conditions deteriorated after the mid-2025 peak as macro risks and profit-taking led to a gradual withdrawal of liquidity, leading to a significant decline in market confidence and a further contraction in demand.
These events led to a sharp decline in the price of Bitcoin and increased market volatility.
Source: CryptoQuant
As weaker holders exited, demand increased contraction sharply reduced from around -136,000 BTC to almost -25,000 BTC. At the same time, sales to long-term holders have fallen by about 70% since November 2025, indicating that the heavy distribution pressure has eased. This decrease in supply allowed the price to stabilize.
Yet broader participation has not returned. Institutional positioning and derivatives activity remain subdued, keeping the Bull Score low. This reflects weak investor confidence and indicates that market conditions remain unfavorable for a sustained upward trend.
Therefore, the current recovery likely reflects seller exhaustion and short-term positioning, rather than the beginning of a structurally supported bull phase.
Coinbase Premium flip hints at…
Bitcoin’s structure still appears fragile, reflecting weak market-wide conviction. Yet the dynamics of spot demand are starting to shift. The Coinbase Premium Index recently turned positive after nearly 40 straight days in negative territory.
Source: CryptoQuant
Rather the Premium often fell below -0.15, matching Bitcoin’s decline from around $95,000 to the mid-$60,000s. These persistently negative numbers indicated that U.S. participants led the selling pressure during the recession.
As the decline matured, Bitcoin stabilized around $70,000 while the premium gradually climbed towards the zero line. The move into positive territory suggests that US buyers have started absorbing supply again.
But with the Bull Score still deeply bearish, this accumulation likely signals an early stabilization rather than a confirmed bullish reversal.
Short Liquidations Cause Bitcoin Upswing
Bitcoin often produces sharp rebounds even during deep bearish phases. Initially, a heavy short position is built up on the derivatives markets, as traders expect further negative consequences. At the same time, funding rates are turning deeply negative, indicating that shorts must pay long to maintain their positions.
As prices stabilize, even a modest increase could trigger forced liquidations. Recently, approximately $736 million in short positions were wiped out as Bitcoin surged toward $70,000. This liquidation cascade forces traders to buy back BTC, accelerating the recovery.
Meanwhile, e.gXchange inflows are slowing from previous peaks, reducing selling pressure and indicating that fewer traders are willing to sell coins at current prices.
As a result, the recent rallies appear to be driven more by short squeezes and whale accumulation than by true trend reversals within the broader bearish cycle.
Final summary
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Bitcoin [BTC] The stabilization around $70,000 reflects seller exhaustion and supply absorption, but weak Bull Score readings show the broader market still lacks conviction for a sustained uptrend.
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Bitcoin’s recovery is currently dependent on short liquidations and local accumulation, indicating tactical rallies within a fragile market structure rather than a confirmed bullish cycle.