Bitcoin is holding steady above the $118,800 mark as the market digests its recent powerful rally to a new all-time high of over $122,000.
While on-chain data now indicates that the first wave of heavy profit-taking has begun, particularly among short-term holders sitting on significant gains, some analysts believe that historical patterns still suggest room for another push higher, though they are also warning that “overheating” signals are beginning to flash.
In a recent report, on-chain analytics firm Glassnode highlighted that “short-term holders are now sitting on significant unrealized profits,” a condition that is pushing key indicators “towards overheated territory.”
The Short-Term Holder Relative Unrealized Profit metric recently hit 15.4%, breaching a key statistical threshold (+1 standard deviation) before cooling slightly. Historically, this level “often marks the beginning of top formation,” according to Glassnode.
The firm also pointed to the Realized Profit to Loss Ratio, which recently spiked to a staggering 39.8, “well above the +2 standard deviation threshold,” signaling a period of intense profit-taking from successful traders.
Although this ratio has since declined to a more moderate 7.3, the elevated reading remains consistent with behavior typically seen in the late stages of a bull market.
“So far, both the Percent of Spent Volume in Profit and the Realized Profit to Loss Ratio have signaled the first wave of excessive profit-taking,” the report concluded.
While this doesn’t necessarily mark a definitive market top, Glassnode cautions that “such top formations tend to unfold across multiple waves,” with the next major resistance level for Bitcoin projected to be around the $130,000 mark.
The great rotation: traders move into altcoins
As Bitcoin’s near-term upside appears increasingly constrained by this profit-taking pressure, some traders are beginning to rotate their capital into major altcoins.
Ethereum (ETH) surged an impressive 7.5% in the past 24 hours, outpacing Bitcoin and breaking out of a recent consolidation phase.
Analysts have pointed to the recent advancement of the GENIUS Act, a stablecoin regulation bill, as a potential catalyst for ETH’s strong performance.
Solana (SOL) also saw a…