Bitcoin (BTC) made a notable recovery on Friday, witnessing a 4% surge that led the leading cryptocurrency to retest the critical $74,000 resistance level, which has remained unbroken for the past month.\u00a0<\/p>\n
However, even with this upward movement, the cryptocurrency has retraced to approximately $72,215, establishing itself at the upper boundary of its ongoing consolidation range.<\/p>\n
Analyst Sunny Mom from CryptoQuant emphasizes that, despite these recoveries, Bitcoin has yet to establish a definitive bottom. She suggests that further price declines may be ahead, as current on-chain data reveals that the market is in a significant \u201cstress test\u201d phase.\u00a0<\/p>\n
Diving into the data, Sunny identifies <\/a>several key factors that indicate the challenges ahead for Bitcoin. First, she points to the 6-12 month cohort of investors, who are currently underwater due to their Realized Price (RP) being concentrated around $100,000.\u00a0<\/p>\n This means that many of these mid-term holders are seeing losses, which could continue to exert downward pressure on prices until this imbalance resolves.\u00a0<\/p>\n Sunny also highlights the MVRV (Market Value to Realized Value) ratio, which stands at 1.2. This figure is commonly regarded as a \u201cDCA (Dollar-Cost Average) zone\u201d for \u201csmart money.\u201d However, substantial cyclical bottoms typically require the MVRV to be less than 1.0, indicating a state of capitulation.\u00a0<\/p>\n Furthermore, the importance of long-term holders <\/a>(LTHs) cannot be overstated. A sustainable price floor generally requires that LTHs\u2014those who have held their positions for over two years\u2014constitute more than 20% of the Realized Cap.\u00a0<\/p>\n Currently, they make up only about 15%, suggesting that the market lacks the robust structural support needed for a strong recovery. She outlines two potential paths for how Bitcoin could find its bottom.\u00a0<\/p>\n The first involves a \u201cBlack Swan\u201d event\u2014a sudden crash that triggers forced liquidations <\/a>among high-cost investors. Although painful, Sunny believes this scenario could lead to a faster establishment of a solid Bitcoin price floor, potentially within one to two months.\u00a0<\/p>\n The second path, referred to as \u201cThe Great Boring,\u201d envisions institutions maintaining their positions, allowing Bitcoin to trade in the $60,000 to $80,000 range for an extended period.\u00a0<\/p>\n The analyst asserts that this would enable new investments to mature into long-term holdings, setting the stage for a bottoming process that could extend into late 2026 or early 2027.<\/p>\nTwo Potential Paths To Find A True Bottom<\/h2>\n