Bitcoin Recovery Hinges on Key Charts, Analyst Warns

CryptoQuant community analyst Maartunn has revealed a concerning similarity between Bitcoin’s recent price action and the November 2021 bull market top. According to the analyst’s X thread analysis, BTC broke above its weekly resistance during the recent price rally but immediately fell below this critical line following last week’s crash. This pattern mirrors what occurred in November 2021, when a similar failed breakout signaled market exhaustion and preceded significant downside movement.

The failed breakout pattern is particularly significant because it represents a technical breakdown at a crucial resistance level. Maartunn noted that such trends typically indicate exhaustion in the market, suggesting that the recent recovery attempt might lack the strength to sustain momentum. This historical parallel raises questions about whether Bitcoin’s current rebound represents genuine strength or merely a temporary relief rally before further declines.

On-chain data from the UTXO Realized Price Distribution (URPD) indicator reveals a substantial resistance barrier between $117,500 and $120,000. The URPD metric shows the amount of Bitcoin that was last purchased or transferred at various price levels throughout the asset’s history. Analysis of this chart indicates that a significant portion of Bitcoin supply has its cost basis within this price range, creating a potential selling pressure zone.

Holders who purchased Bitcoin between $117,500 and $120,000 are currently underwater on their positions. If BTC manages to recover to their break-even level, these investors might panic sell to avoid returning to losses. Given the scale of supply involved in this price range, such selling pressure could create a major resistance barrier that prevents further upward movement. This dynamic makes the $117,500-$120,000 range a critical area to watch for any sustained recovery attempt.

The average cost basis or Realized Price of short-term holders (STHs) represents a key support level that has historically helped Bitcoin find rebounds during bullish trends. According to Maartunn’s analysis, this level has provided support three times within the last six weeks alone, demonstrating its importance in the current market structure. However, the analyst warns that conviction among this cohort is showing signs of deterioration.

The Market Value to Realized Value (MVRV) Ratio for Bitcoin short-term holders suggests profitability among this group has been following a long-term decline. The metric is currently testing the critical boundary level of 1, which represents the point where the average short-term holder breaks even on their investment. Maartunn emphasized the significance of this level, stating: “If this level breaks, expect downside. If it holds, it confirms demand — but manage risk accordingly!”

This fading conviction among short-term holders, combined with the testing of the MVRV ratio at the critical 1 level, creates additional uncertainty for Bitcoin’s near-term direction. The outcome of this test could determine whether the current recovery holds or whether further downside pressure emerges in the coming days and weeks.