Bitcoin Bottom Confirmed? Identifying the Final Hurdles for BTC

Story Highlights

• Two technical indicators have pointed to an impending bottom for Bitcoin, with support from several on-chain metrics.

• Key opinion leaders see the broader market downturn as a buying opportunity, with Strategy now owning 3.7% of all BTC.

• Certain conditions should now be met for BTC to begin the next rally.

Two technical indicators now suggest that Bitcoin (BTC) is entering a bottoming-out phase that precedes the next market rally. However, certain conditions must be met before the final major breakout occurs.

Just today, Bitcoin fell below $71,000 following news of the US blockade at the Strait of Hormuz. The coin later recovered to trade above $72K after clarification that non-Iranian tankers would not be affected, and on the back of BlackRock buying $612 million worth of BTC.

Bitcoin bottom technical indicators

As for a bottom, according to Bitcoin’s Market Value to Realized Value (MVRV) indicator, we are not there yet, but are approaching it. 

As the chart below shows, the MVRV has yet to turn negative, a level that has historically marked a price floor and preceded upward momentum. A realized price of $54,173 places the current MVRV at 1.35, whereas capitulation phases have historically aligned with MVRV values of 1.0 or below.

Meanwhile, the Bitcoin market capitulation oscillator indicates we are entering a historical cyclical low.

On-chain indicators

Exchange flows point to heightened accumulation at this time, with the 30-day average Bitcoin inflows on Binance dropping to 2020 lows.

Supporting the narrative is BTC open interest, which is up 5.79% in the past 24h, reaching $54.84B at the time of writing, while short liquidations outperformed longs at $90.10 million over the same period.

Conditions for the next bull market

JPMorgan now calls a “buy the dip” opportunity, saying oversold signals support a V-shaped recovery despite geopolitical unrest. Meanwhile, Strategy continues to buy in relentlessly, now holding 3.7% of all Bitcoin that will ever exist.

Beyond the prompt resolution of the US-Iran conflict, Bitcoin reclaiming its 2021 ($69K) and 2024 ($106K) all-time highs would also generate considerable upside momentum.

Markets now wait patiently to see how the conflict evolves and to gauge subsequent investor reaction.