Normally, mixed signals tend to create a volatility loop as momentum builds on speculation.
Watch Bitcoin [BTC]it seems to play out the same way. According to CoinGlass, Open Interest (OI) has bounced back to early February levels, surpassing $55 billion, the biggest spike since the start of the war. But in February, BTC traded above $75,000, while this time it is still struggling below that key resistance.
This difference indicates that leverage is increasing faster than spot price strength, which typically leads to increased short-term volatility. In this kind of environment, it therefore seems a bit premature to call a Bitcoin bottom, and the on-chain metrics seem to support that view as well.
The Puell Multiple is one of those indicators that looks at miners’ earnings. Historically, every major BTC bear market bottom has aligned with the Puell Multiple falling into the green “undervalued” zone.
However, as the chart shows, Bitcoin has not yet bottomed out, indicating that the market may still be in a transition phase and not in a confirmed cycle bottom. Combined with the trend after the halvingAnalysts also point out that BTC’s four-year cycle is still playing out by the book.
Therefore, some view the fourth quarter of 2026 as a potential low, with downside scenarios around $40,000. However, “Smart Money” doesn’t seem to be entirely consistent with that narrative, suggesting that traders are positioning themselves more dynamically rather than following strictly cycle-driven setups.
In short, the current setup around Bitcoin’s resistance of $75,000 is dividing the market. This obviously begs the question: are these mixed signals causing BTC to enter a volatility loop, reinforcing that a clean bottom is still premature? Or does this divergence actually cause a bear trap?
Bitcoin approaches $75k as the market remains divided
Bitcoin’s technical setup and current on-chain signals are both starting to lean toward a bearish bias.
On a macro level, Bitcoin reacted sharply after US Vice President JD Vance left Pakistan and called the peace talks with Iran a “failure.” The news caused an immediate risk-off move, with BTC falling 1.87% intraday. More importantly, it also wiped leverage out of the system, wiping out nearly $48 million in long positions and making it the largest long liquidation event of the month so far.
At the same time, the supply of long-term Bitcoin holders continues to rise steadily. As the chart shows, approximately 200,000 BTC have been collected in this cohort alone this month. This creates a clear divide in sentiment: fear dominates short-term price action, while long-term holders continue to accumulate weakness.
According to AMBCrypto, this setup looks like a textbook bullish divergence.
As weak hands disappear and overheated derivatives cool, on-chain bearish signals continue to keep retail cautious, while smart money steadily accumulates. Bitcoin now appears to be forming a classic bear trap structure, which could set the stage for a breakout above $75,000, reinforcing the broader bottom theorem.
Final summary
- Leverage is increasing faster than spot strength, with Bitcoin’s mixed on-chain signals pointing to increased volatility rather than a confirmed bottom.
- As weak hands disappear, long-term holders continue to accumulate, creating a divergence that could fuel a bear trap near $75,000.