While the recent 19% recovery in cryptocurrency markets has led many investors to believe “the bottom is behind us,” a cautious statement has come from the leading analysis platform, The DeFi Report.
Company founder Michael Nadeau stated that despite a shift in market sentiment towards bullish sentiment, on-chain data and macroeconomic liquidity conditions are not yet supporting this rise.
Nadeau, while evaluating Bitcoin’s performance since its lows in February, countered the market’s narrative that “this time it’s different, the 4-year cycle is over.”
According to the analyst, market cycles are not based solely on “feelings,” but on a clear set of events such as capital creation and investor psychology.
Highlighting the correlation between the global liquidity index and the Bitcoin price, The DeFi Report noted that Bitcoin typically peaks before liquidity peaks. Current data suggests that global liquidity is on a downward trend.
Nadeau, drawing a comparison with the 2022 bear market, noted that Bitcoin has not yet spent enough time below its “realized price” and the 200-day moving average. This suggests that a true capitulation phase may not have occurred in the market yet.
The decline in memecoin traffic and DEX volumes, particularly on the Solana network, is being interpreted as a sign that speculative appetite in the market is decreasing.
According to the analysis report, Bitcoin needs to overcome several technical levels to prove that its current surge is sustainable:
$76,000: 100-day moving average level.
$81,000: The cost base for short-term investors.
$85,000 – $87,000: Unless weekly closes above this region occur, the current movement may remain a “bear market rally”.
*This is not investment advice.
