Bitcoin rebounds 10% to $63K as CryptoQuant warns of bear-market rally

CryptoQuant says Bitcoin's 10% rebound from $57,700 remains a bear-market recovery, not a confirmed trend reversal.

Bitcoin rose 10% to $63,000 after touching a $57,700 low last week, though CryptoQuant flagged the move as a bear-market rally rather than a durable reversal. The on-chain analytics firm said its broader indicators remain defensive despite the price improvement.

"The recovery is not yet a regime change," the firm's analysts wrote in a July 8 research note, pointing to on-chain indicators that remain in bearish territory. CryptoQuant's assessment comes as Bitcoin's 30-day total demand measure contracted by about 650,000 BTC in early June, the sharpest pullback since 2022, before recovering to near neutral.

The Coinbase Premium Index, a proxy for US spot demand, improved to -0.062 from deeply negative levels in early June, suggesting selling pressure on US exchanges has eased. Short-term holder unrealized profit margins fell below -24%, beneath the firm's -12% undervaluation threshold, indicating capitulation may have formed a local floor. Still, CryptoQuant's Bull Score Index, which blends on-chain, market and valuation indicators, stands at 20 — far below the 60 level the firm says is needed to support a sustainable rally.

July seasonality may provide a near-term tailwind. Bitcoin gained 20% in July 2018 and 17% in July 2022, both bear-market years, according to CryptoQuant. But without a confirmed demand reacceleration into positive territory, the burden remains on buyers to convert this bounce into a durable uptrend.

Demand Improves, But Confirmation Lags

Speculative futures demand has turned slightly positive, while spot demand is contracting at its slowest pace since mid-May. CryptoQuant said a move back into positive territory is still needed to confirm real ignition. The demand engine is closer to restarting, but the firm cautioned that seasonality can lift prices without changing the cycle.

Traders are watching the $64,700 level for the daily close, according to Daan Crypto Trades. A close above that mark would flip the near-term narrative and open the door to a larger relief rally, while a close below $61,300 risks a retest of recent lows. Bitcoin's exchange supply has fallen to 6.6% of circulating supply, the lowest since 2017, according to Santiment — a metric historically viewed as bullish, though analysts note its reliability has diminished as coins shift into institutional custody and DeFi protocols rather than long-term cold storage.

Crypto short liquidations reached nearly $100 million over 24 hours as the rebound accelerated, per Coinglass data. The move was aided by a broader risk-asset rally after US President Donald Trump said Iran "wants to make a deal," easing geopolitical tensions that had weighed on markets earlier in the week.

For now, the rebound looks tactical and useful, but the burden of proof remains with buyers trying to convert improved demand into a durable recovery rather than another bear-market bounce.

This article is for informational purposes only and does not constitute investment advice.