The Bitcoin price saw a short-term rebound after slipping to recent lows, gaining nearly 5% from its late-January bottom to test the $76,980 zone. This $BTC price move followed a bullish momentum setup on the 4-hour chart, where selling pressure appeared to weaken.
At first, the $BTC bounce made sense from a technical view, as a common short-term pattern had already played out. However, a deeper look at on-chain data and market structure reveals three key indicators that are now casting doubt on whether this move can turn into a lasting recovery.
Chart Setup That Pointed to a 5% Bounce
On the 4-hour chart, Bitcoin printed a bullish divergence between January 31 and February 3.
During that time, $BTC price pushed to a lower low, while the Relative Strength Index (RSI) showed a higher low. This setup usually signals that selling pressure is weakening and that a short-term bounce, especially on lower timeframes, may follow.
A comparable divergence formed earlier from January 20 to January 30, which triggered a push up to $84,640 before sellers stepped back in and regained control.
This time, the pattern sparked a nearly 5% bounce, pushing Bitcoin up to around $76,980. The move mirrored the previous technical setup, supporting the view that the rebound had a solid structural basis.
The $BTC rebound was also supported by macro factors, according to Martin Gaspar, Senior Crypto Market Strategist at FalconX. He linked the surge to a shift from precious metals, occurring just before the divergence appeared.
Given Friday’s blow-off top in metals, traders may be anticipating a rotation back to crypto. While $BTC had previously been seen as a beneficiary of strength in gold, capital that may have flowed to crypto off such moves instead funneled to silver in recent months. This could revert as silver cools off,” he said
Metric One URPD Shows Strong Sell Walls at Key $BTC Levels
The first indicator casting doubt on the rebound is the UTXO Realized Price Distribution (URPD), which shows the price levels at which significant amounts of Bitcoin last changed hands.
URPD data indicates that roughly 0.46% of Bitcoin’s total supply is clustered around $76,990. This creates a key supply zone where many holders are near their break-even point, which helps explain why the recent 5% bounce paused near $76,980.
As the price nears these levels, selling pressure tends to rise because investors aim to sell without taking a loss.
A similar pattern has occurred previously.
The previous $BTC bounce in late January paused around $84,640, near the URPD area, which held a significant 3.05% supply cluster. That level acted as a strong barrier that the price couldn’t overcome.
The most recent bounce has also paused near another area with heavy supply. This indicates that gains are being limited by holders, who may be selling at resistance instead of adding new positions. Without strong new buying, these sell barriers are hard to overcome.
Rising Exchange Reserves and Weak SOPR Show Low Conviction
The next two indicators exchange flows and profit-taking patterns together present a worrying outlook.
Bitcoin exchange reserves hit a recent low of 2.718 million $BTC on January 19. Since then, reserves have climbed to about 2.752 million $BTC.
That is an increase of roughly 34,000 $BTC, or around 1.2% in less than three weeks.
Rather than moving to wallets for long-term holding, more Bitcoin is flowing back onto exchanges, which typically signals an increasing willingness to sell instead of buy.
Meanwhile, the Spent Output Profit Ratio (SOPR) is close to its yearly lows. SOPR indicates if coins are sold at a profit or loss, and a reading below 1 shows that investors are selling at a loss.
In late January, SOPR fell to around 0.94. It is now near 0.97, still under the neutral mark, indicating that many holders are selling even at a loss.
When increasing exchange balances coincide with a low SOPR, it points to cautious behavior. Investors are taking advantage of rebounds to sell rather than to increase long-term holdings.
This undermines the strength of any recovery unless a significant catalyst emerges. Martin Gaspar from FalconX suggests one potential sentiment-driven factor related to regulatory clarity that could influence the $BTC price trend.
“In the weeks forward, primary catalysts will include any developments on the crypto market structure bill, with key groups set to meet at the White House this week to discuss the bill,” he highlighted.
Bitcoin Price Levels and Smart Money Show the Rebound Is Losing Support
Bitcoin’s price movement aligns with the signals from these three metrics. To regain upward momentum, it needs to break through several key levels.
$76,980: Immediate resistance from the current supply cluster$79,360: Next short-term barrier$84,640: Major long-term resistance tied to the largest $BTC URPD zone
For a lasting recovery, Bitcoin needs solid 4-hour closes above these levels, particularly over $84,640. Up to now, $BTC has not been able to show strength past the initial resistance.
The Smart Money Index provides an additional warning. This metric monitors institutional-type activity, and on the 4-hour chart, it has stayed below its signal line since late January, indicating that major players are not buying into the rebound.
The last time the index briefly moved above its signal line in late January, Bitcoin gained roughly 5%. That confirmation is absent now, and without fresh smart money involvement, each short-term $BTC bounce could quickly lose steam.
Additionally, if panic-driven selling, reflected by the declining SOPR, drives $BTC lower, the $72,920 level becomes crucial. A 4-hour close below this zone could open the door to further downside targets.
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