Bitcoin Breaks Above $70,000: Start of a Bull Run or a Smart Trap?
Bitcoin (BTC) has made a sharp move upward in the past 24 hours, breaking through the psychological resistance of $70,000. Trading volume jumped by over 18%, while market sentiment is now nearing "Extreme Greed" according to the Fear & Greed Index.
What Triggered the Surge?
- Lower-than-expected US inflation: A softer CPI report led to a capital shift toward risk-on assets like crypto.
- ETF inflows: BlackRock and Fidelity reported record net inflows into their spot BTC funds.
- Declining exchange reserves: According to Glassnode, BTC held on exchanges hit a 3-year low, signaling long-term accumulation.
On-Chain Data Insights
- MVRV Ratio: Currently in the upper-neutral range — not yet overvalued.
- Dormancy Flow: Low activity from old coins — long-term holders are not selling.
- Funding Rates: Positive but not excessive, indicating healthy futures positioning.
Is This Rally Sustainable?
Some analysts warn that the sharp upward move may lead to a short-term correction. The possibility of a bull trap remains, especially if the Fed signals a hawkish stance in upcoming meetings.
Key Levels to Watch
- Resistance: $72,400
- Support: $67,800
A confirmed breakout above $72,400 could pave the way for new all-time highs.
Conclusion
Bitcoin is at a pivotal moment. While many believe this could be the beginning of a major bull cycle, caution is still advised due to macroeconomic uncertainty.
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