Bitcoin’s price surged to a new all-time high of $99,900 in the last weeks, prompting discussions of a potential market top. However, cryptocurrency analysis firm CryptoQuant argues that on-chain indicators suggest the bull run is far from over.
Despite a recent correction to around $91,000, CryptoQuant’s analysis indicates that Bitcoin remains in a strong bull market and hasn’t reached the overvaluation levels typically seen at the end of a cycle. Their valuation models suggest a potential price target of $146,000, a level that has historically marked previous cycle peaks, such as in January 2021.
One key indicator highlighted by CryptoQuant is the value of Bitcoin held by new investors. Currently, this figure sits just above 50% of the total invested capital, significantly lower than the 90%+ seen in 2017 and 80%+ in 2021 during previous market tops. Historically, tops occur when a surge of new investors enters the market at high prices, pushing their share of the total value held to extreme levels. The current data suggests this hasn’t happened yet.
Furthermore, CryptoQuant notes a lack of aggressive retail activity, another hallmark of market peaks. Retail investors have actually been reducing their holdings since October, shedding 41,000 Bitcoin, while large investors have accumulated 130,000 Bitcoin over the same period. This contrasts with previous bull cycle endings, which were characterized by frenzied retail buying.
CryptoQuant’s “Bull-Bear Market Cycle Indicator” further supports this bullish outlook. The indicator remains firmly within the “BULL” phase, intensifying since early November, and is far from the “OVERHEATED BULL” phase observed during the previous all-time high above $70,000 in March 2024.
While the overall outlook remains bullish, CryptoQuant points to one metric suggesting a potential short-term correction: MicroStrategy’s stock price. The business intelligence company’s stock has surged 113% since November 3rd alongside Bitcoin’s rally. However, this increase has pushed the stock price to the upper bounds of its historical correlation with the value of MicroStrategy’s Bitcoin holdings, potentially signaling a short-term pullback.
