Bitcoin Bounces Back Above $100K – Is the Bull Run Resuming or a Correction Ahead?

After weeks of trading below the critical $100,000 mark, Bitcoin has started 2025 with renewed bullish momentum. The cryptocurrency, which had been struggling since last month, has shown signs of recovery, climbing back above the psychological $100,000 threshold earlier today for the first time in recent weeks.

Bitcoin entered the year trading between $93,000 to $95,000 but has now regained momentum as its current trading price sits at $102,368.  Over the past 24 hours, Bitcoin has surged by a 4.5% increase, bringing it closer to its all-time high of $108,000 achieved in late 2024.

This upward movement has reignited optimism among both retail and institutional investors, with many closely watching key market indicators to understand whether Bitcoin can sustain this momentum or if another correction might be on the horizon.

CryptoQuant analyst Yonsei Dent recently shared an analysis of Bitcoin’s price dynamics, highlighting the role of the Realized Price of Short-Term Holders (STH) as a key breakeven point.

The Realized Price represents the average purchase price of Bitcoin by short-term holders, segmented into two critical bands: 1-week to 1-month (1W-1M) and 1-month to 3-month (1M-3M).

Historically, the 1M-3M band has consistently acted as a medium-term support zone, while the 1W-1M band reflects short-term market sentiment. When the gap between these two bands widens, Bitcoin often experiences consolidation or corrective phases until they converge again.

Currently, Bitcoin is encountering resistance at the 1W-1M band. However, the 1M-3M band continues to provide strong support, indicating a potential accumulation opportunity for medium-term investors.

Yonsei Dent emphasized that monitoring the interaction between these two bands is essential for identifying market trends. As they move closer together, Bitcoin may experience a period of relative stability before determining its next significant price direction.

Another CryptoQuant analyst, Joohyun Ryu, provided insights into Bitcoin’s recent correction phase, noting that while the market exhibited signs of cooling, key indicators suggest a potential rebound.

Metrics such as Market Value to Realized Value (MVRV), Adjusted Spent Output Profit Ratio (aSOPR), and Net Unrealized Profit/Loss (NUPL) offer valuable context for assessing market sentiment.

The MVRV ratio currently stands at 2.358, indicating that Bitcoin is trading at a moderate premium relative to its realized value. Similarly, the aSOPR metric, currently at 1.02, suggests that Bitcoin transactions are still yielding profits on average.

Meanwhile, the NUPL value of 0.58 reflects a market sentiment that remains in a state of optimism despite recent price fluctuations. Ryu also highlighted the continued activity of short-term holders, noting their consistent market participation despite recent volatility.

This steady influx of new investors suggests growing confidence in Bitcoin’s long-term value proposition. Historically, such behavior has preceded significant upward price movements, reinforcing the notion that the recent market cooling phase may set the stage for a potential breakout.

Featured image Created With DALL-E, Chart from TradingView