Bitcoin has surged above $75,000 amid geopolitical optimism, but on-chain data indicates the market may be entering a “value-accumulation” phase. Key indicators suggest the recent correction has reset valuations to levels seen in early 2023, though analysts warn the possibility of further downside pressure remains.
Bitcoin is trading above $75,000 following a strong week as risk assets rose on hopes for a US-Iran deal. New data shows the asset is testing a major historical pivot zone.
The Bitcoin Combined Market Index (BCMI) is nearing important historical support after plunging into the 0.2-0.3 range. This zone has previously defined periods when Bitcoin was significantly undervalued. The index combines multiple on-chain and sentiment indicators such as MVRV and NUPL.
The 90-day moving average of the index continues to trend lower, indicating downward pressure has not fully eased. Current data points to reduced downside risk relative to potential long-term gains.
Analyst Ali Martinez said most Bitcoin traders are now betting to the upside following a liquidation of almost $80 million in short positions. He noted that the biggest clusters of long positions are now located at $70,000, $65,000, and $57,000.
Some analysts expect a more pronounced correction. An early BTC advocate, Davinci Jeremie, warned the market may not have reached its cycle bottom yet. He highlighted similarities between the recent drop below $60,000 and the decline seen in June 2022.
