Bitcoin is showing signs of renewed strength after reclaiming a key technical level that historically marks the start of short-term rallies. According to a June 25 analysis by CryptoQuant contributor İbrahim COŞAR, Bitcoin has successfully moved back above its 50-day exponential moving average, a trend line often used to identify major shifts in market momentum.
In the past, Bitcoin's price often increased by 10% to 20% when it dropped below the 50-day EMA during a correction and then swiftly rose above it again. It appears that the pattern is reoccurring. Bitcoin has now closed three days in a row above the 50-day EMA, indicating that bulls may be regaining control. COŞAR believes this could pave the way for a move toward $120,000 in the short term, though he warns that geopolitical events involving the United States, Israel, and Iran, could bring about unexpected volatility.
At the time of writing, Bitcoin is trading at $106,720, up 1.4% in the past 24 hours. This represents a 7.8% recovery from its June 22 low of $98,974 when the market sold off in response to escalating Middle East tensions. Some analysts believe that geopolitical unrest may strengthen Bitcoin's long-term appeal as a hedge. War and inflation risks often lead to increased government spending and easing of monetary policy, conditions that tend to favor Bitcoin.
Despite the conflict, investor interest in Bitcoin has remained strong. For the eleventh day in a row, spot Bitcoin exchange-traded funds have seen consistent inflows. According to SoSoValue data, total net inflows in the past week have reached $938 million, showing continued interest from investors. On the technical side, Bitcoin is approaching the upper band around $110,100 after breaking above the 50-day EMA. If Bitcoin is able to consolidate above the moving average, it could see a surge.
Meanwhile, CryptoQuant noted that if demand keeps weakening, Bitcoin could find support near $92K. This level represents the Traders' On-chain Realized Price, a typical price support during bull markets. If this level fails, the next support is around $81K, the lower band of the Traders' On-chain Realized Price.
However, even if Bitcoin continues to gain, $120K could act as the next major resistance level. This price represents the upper band of the Traders' On-chain Realized Price, a price at which the On-chain Trader's Unrealized profit would reach 40%, as noted above. Historically, the Traders' On-chain Realized Price upper band has acted as an important resistance level for Bitcoin during bull markets.
Additionally, CryptoQuant warned that the sharp decline in exchange inflows and deposits for Bitcoin, Ethereum, and XRP points to low selling pressure across major assets, even as prices remain elevated. Daily Bitcoin inflows to exchanges stand at approximately 22K BTC, a sharp decline from the 121K BTC observed in November, when Bitcoin first surpassed the $100K mark. Historically, higher exchange inflows have signaled increased selling pressure, so the current muted levels suggest reduced intent to sell among investors.