Bitcoin has cooled off after hitting a record high of $112,000, entering a phase of consolidation that has left investors questioning whether this is merely a mid-cycle pause or the beginning of a deeper correction. Chain analysts are closely monitoring on-chain signals, revealing signs of weakening momentum while highlighting critical support zones that could determine the next major move.
Market Momentum Shows Early Signs of Fatigue
After peaking at $112,000 last week, Bitcoin has seen a pullback accompanied by multiple waves of profit-taking—classic indicators that bullish energy may be waning. Analyst Murphy recently pointed out that while the second wave of realized profit on May 29 was slightly smaller than the first on May 23 (around $2.1 billion), it still triggered significant downward price pressure. This suggests weakening demand and reduced market absorption capacity.
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On-chain data reveals a continued decline in supply held by short-term holders (STH), shown by the red line in UTXO distribution models. This trend echoes a similar divergence seen in late November last year, signaling diminishing investor confidence.
This recent rally appears to have been driven more by low liquidity and holder reluctance to sell—“coin hoarding”—rather than strong incoming demand. As a result, upward momentum is capped unless fresh capital enters the market at scale.
Even so, Murphy remains cautious but not bearish. Drawing from historical cycles, he notes that the first sign of momentum decay doesn’t necessarily mark the end of a bull run. In fact, such phases are often followed by renewed rallies that surpass previous highs.
“If we see another rebound—and especially if it comes with larger realized profit volumes—it could push Bitcoin past $110,000 and potentially retest the $112,000 peak,” Murphy explained.
Three Critical Support Zones to Watch
As momentum slows, attention turns to key support levels where buying interest may re-emerge. Based on UTXO Realized Price Distribution (URPD) analysis, Murphy identifies three crucial zones that could act as safety nets during a pullback:
1. $100,000 – $105,000: Psychological and Structural Support
This range shows a dense accumulation of on-chain supply, indicating strong market conviction at these levels. The $100,000 mark isn’t just a psychological milestone—it’s also a technical fortress backed by realized cost bases and historical trading activity.
2. $93,000 – $98,000: Home of the Committed Buyers
This zone is primarily occupied by newer buyers who entered during recent rallies. Unlike short-term traders, these investors likely have longer time horizons and stronger conviction, making this area a potential stronghold for defensive buying.
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3. $81,000 – $87,000: Last Line of Defense
While deeper, this zone lacks the structural robustness of the upper two. It represents a more extreme scenario where panic selling or macro shocks could push prices. Still, it aligns with longer-term average cost bases and may attract deep-value investors.
Among these, $96,000 stands out as a pivotal level—it marks the Realized Price Cost (RPC) for short-term holders. Analysts refer to this as the bull-bear line. A sustained break below this point could signal the end of the current uptrend and trigger broader risk-off behavior across crypto markets.
PlanB Weighs In: Bull Market Alive, But Losing Steam?
Bitcoin analyst and creator of the Stock-to-Flow (S2F) model, PlanB, recently shared a logarithmic chart of Bitcoin market cycles from 2010 to 2025, suggesting that the asset remains within a long-term bull phase.
“Bitcoin May close: $104,646 … 🔴 continues!” – PlanB
The chart shows consecutive red dots indicating ongoing accumulation phases without a clear distribution signal. However, the flattening slope of the current cycle has sparked debate in the community about whether momentum is fading.
When asked when yellow dots—indicating distribution—might appear, PlanB replied: “On-chain transaction data hasn’t shown distribution signals yet.” This implies that while upward acceleration may be slowing, the fundamental structure of the bull market remains intact.
Key Metrics to Monitor Going Forward
Investors should focus on several leading indicators to gauge the health of the current cycle:
- Realized Profit Volume: Rising profit-taking during new highs confirms strength; declining profits amid price gains suggest exhaustion.
- STH Supply Trends: Continued decline suggests weak hands are exiting—bearish if not offset by new demand.
- Exchange Netflow: Large outflows indicate accumulation; inflows may precede selling pressure.
- Market Cap to Realized Cap Ratio (MVRV): Values above 3.7 have historically marked tops; currently hovering near cautionary levels.
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Frequently Asked Questions (FAQ)
Q: Is Bitcoin in a bear market yet?
A: Not necessarily. While momentum is weakening, there’s no confirmed reversal pattern or distribution signal on-chain. Many analysts believe this is a healthy correction within an ongoing bull cycle.
Q: What happens if Bitcoin drops below $96,000?
A: That level is considered the bull-bear line for short-term holders. A sustained break could trigger stop-loss cascades and erode confidence, potentially opening the door to tests of lower supports around $81,000–$87,000.
Q: Can Bitcoin rally again without strong new demand?
A: Possible in the short term due to low liquidity and short squeezes, but sustainable rallies require fresh capital inflows. Without growing demand, prices may struggle to exceed previous highs.
Q: How reliable are on-chain support zones?
A: UTXO-based support levels reflect actual cost bases and holder behavior, making them more reliable than traditional technical levels. However, black swan events or macro shocks can override them.
Q: What’s the best strategy during uncertain phases like this?
A: Focus on risk management—scale positions gradually, use stop-losses wisely, and avoid over-leveraging. Monitoring on-chain metrics can help time entries and exits more effectively.
Final Thoughts: Navigating Uncertainty with Data
As Bitcoin transitions from explosive growth to a more mature phase of its cycle, clarity becomes harder to find. Yet, tools like on-chain analytics offer a window into true market structure—beyond price action and sentiment noise.
Whether this is a mid-bull rest or the start of a top formation depends on how price interacts with key supports and whether new demand emerges. For now, staying alert and data-driven is the best defense against volatility.
Core Keywords: Bitcoin price analysis, Bitcoin support levels, on-chain analysis, market momentum, bull-bear line, realized profit, short-term holder supply, crypto market cycle