Is Bitcoin’s retreat to $96,000 a setup for another rally?

• BTC has dropped into a bear trend, according to its RSI.
• Despite the drop, there has been an increase in the supply to whales.

Bitcoin [BTC] is stabilizing at around $96,000 after a minor retracement from its recent high near $100,000. A convergence of on-chain metrics and technical indicators suggests strong market confidence, with whales accumulating and realized losses decreasing.

Additionally, the price remains well-supported by key moving averages, reinforcing its bullish trajectory.

Bitcoin price holds critical levels amid consolidation

AMBCrypto’s analysis of the daily timeframe chart shows Bitcoin trading at $96,169, maintaining support above the 50-day Moving Average (MA) at $92,413. The sustained break above the 50-day and 200-day MAs earlier this year has positioned Bitcoin in a strong uptrend.

Source: TradingView

While Bitcoin briefly surpassed the psychological $100,000 mark, the retracement reflects healthy profit-taking rather than a trend reversal.

Trading volume remains strong, underscoring sustained market participation. Staying above $96,000 is crucial for bulls to defend, as it aligns with a key consolidation zone from earlier in the rally.

On-chain metrics signal bullish strength

Analysis of the Realized Loss by LTH/STH chart, per Glassnode data, shows a decline. The decline in realized losses for short-term and long-term holders coincided with Bitcoin’s recent price surge.

This indicates reduced sell pressure, as holders are increasingly confident in Bitcoin’s upward trajectory.

Similarly, the Short-Term On-Chain Cost Basis Bands chart shows Bitcoin’s price firmly above the realized price for short-term holders. As of this writing, the realized price for STH is around $85,272.

Also, the low band price is around $65,963, while the high band is around $121.111. Historically, such alignments signal bullish momentum, as short-term holders are now in profit and less likely to sell.

Source: Glassnode

Whale activity reinforces confidence

The Bitcoin Supply Heatmap chart confirms significant whale accumulation at higher price levels, particularly above $85,000.

The heatmap shows large clusters of Bitcoin shifting to wallets at these levels, reducing liquidity and strengthening price floors. This accumulation underscores the strong conviction among major investors.

Source: Glassnode

Strong fundamentals support Bitcoin’s rally

Bitcoin’s ability to hold above $96,000, coupled with bullish on-chain signals like diminishing realized losses and whale accumulation, suggests the rally remains intact. 

 Read Bitcoin (BTC) Price Prediction 2024-25

While minor retracements are healthy, Bitcoin’s alignment with key technical levels and increased demand at higher price buckets support a long-term bullish outlook.

Traders should monitor the $92,000 support level and further whale activity as potential catalysts for Bitcoin’s next leg upward.