Bitcoin’s recent climb past $79,000 was fueled by aggressive buying in the derivatives market, with data showing a stark divergence from weakening spot demand. The cryptocurrency reached an intraday high of $79,447 on April 22 before trading at $78,258 at press time, up 2.54% on the day.
“There are risks of a correction if traders start taking profits while spot demand continues to contract,” said Julio Moreno, head of research at CryptoQuant. He noted the rally is fueled by activity in perpetual futures, a setup similar to the market peak in January.
On-chain data revealed that open interest in Bitcoin futures swelled by nearly $3 billion on April 22, preceding the price peak. In contrast, spot Bitcoin ETFs registered a net outflow of $1.845 billion on the same day. Following the peak, open interest contracted from $27.56 billion to $25.26 billion by April 24, confirming that traders were closing out positions.
The divergence between leveraged speculation and institutional spot selling creates a fragile structure, elevating downside risk in the near term. The next key resistance level to watch is the Short-Term Holder Cost Basis at $80,500, a zone where investors who bought between $60,000 and $70,000 may look to take profits.
The primary engine behind Bitcoin's 10% monthly gain has been the perpetual futures market. A sustained period of negative funding rates for 47 consecutive days has made holding short positions expensive, creating the technical conditions for a short squeeze. As prices rose, short sellers were forced to buy back, adding to the upward momentum.
However, this rally lacks the foundation of organic spot demand. The significant outflows from Bitcoin ETFs, which are a proxy for institutional interest, suggest that larger, long-term investors are not participating in this price increase. This creates a structural weakness, as the rally is dependent on continued speculative momentum rather than fundamental buying pressure.
Several on-chain metrics are signaling that the rally may be overheated. According to Glassnode, the 24-hour simple moving average of Short-Term Holder Realized Profit has reached $4.4 million per hour. This is nearly three times the $1.5 million level that has historically marked local price tops this year.
With Bitcoin breaking above the True Market Mean of $78,100, the next major hurdle is the Short-Term Holder Cost Basis at $80,500. A large cohort of investors who purchased Bitcoin in the $60,000 to $70,000 range are now approaching profitability and may be inclined to sell, adding further pressure to the market. The combination of high profit-taking by short-term holders and a lack of spot demand suggests that the path to higher prices may be challenging.
This article is for informational purposes only and does not constitute investment advice.
