A Bitcoin analyst has argued that Bitcoin is still in a bull market as it briefly recovered to over $112,000 on Monday after a week of major volatility.
Bitcoin (BTC) has struggled to gain over the past week as analysts said investors were showing signs of exhaustion, with its sudden drop last week resulting in two major liquidation events across the wider crypto market.
Bitcoin hit a 24-hour high of $112,293 in early trading on Monday, surpassing $112,000 for the first time since sharply falling on Thursday. It is currently trading at $111,835, according to CoinGecko.
Bull market “not over” for Bitcoin
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However, crypto investment firm XWIN Research Japan said in a CryptoQuant note on Sunday that “while recent volatility has unsettled traders, on-chain data continues to suggest that Bitcoin’s bull market is not over.”
It said that long-term holder behavior and Bitcoin’s Market Value to Realized Value (MVRV) ratio, which compares its market value to the average cost basis of holders, together show “resilience beneath the surface.”
“Bitcoin’s recent pullbacks appear less like the end of a rally and more like a period of digestion,” XWIN added.
Bitcoin’s MVRV ratio has dropped to 2, with the average cost basis at around half of the value of Bitcoin’s price, which XWIN said historically “reflects neither panic nor euphoria.”
“Investors are still sitting on healthy gains, yet the market has cooled from overheated conditions,” it explained, adding that past cycles have seen Bitcoin enter “its strongest expansion phase” after consolidating in this MVRV range.
Bitcoin’s MVRV ratio (purple) compared to its price (black) since late 2024. Source: CryptoQuant
Meanwhile, profit-taking by long-term investors has fallen, which XWIN said “effectively reduces available supply, offsetting short-term volatility and creating the conditions for renewed demand to lift prices higher.”
XWIN said the two metrics show that “this cycle has not reached its terminal stage,” and added that the recent consolidation “could mark the groundwork for the next major leg upward—suggesting the bull market is alive and well.”
Crypto longs decimated by Bitcoin’s fall
Bitcoin’s recovery comes after crypto bulls were wiped out of over $4 billion in two major liquidations in the past seven days.
The first major liquidation on Monday, Sept. 22, saw just under $3 billion in long positions across the crypto market wiped out as Bitcoin fell 3% to below $112,000 and dragged the rest of the market down, per CoinGlass data.
The amount of long liquidations across the market surged on Monday, Sept. 22, and Thursday as Bitcoin fell. Source: CoinGlass
That was followed up with a $1 billion liquidation of total crypto longs on Thursday, with the market again hampered by Bitcoin’s drop to $109,000.
Related: Expect major BTC corrections before new all-time highs: Analyst
Bitcoin made up the bulk of the liquidations on Sept. 22, with $726 million longs erased, while Ether (ETH) long bets led on Thursday, with $413 million wiped out.
Crypto sentiment rises to “Neutral”
Meanwhile, the sentiment tracking Crypto Fear & Greed Index has risen to reflect that the market is “Neutral” for the first time since Friday, Sept. 19, recovering from a period of “Fear.”
The index hit a score of 50 out of 100 on Monday, rising 13 points from Sunday.
It continues an uptrend the index has enjoyed since falling to a score of 28 on Friday, its lowest since mid-April when Bitcoin sank to $80,000.
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