Digital gold is showing signs of short-term consolidation after reaching a new ATH above $123,000 in July. This was highlighted by CryptoQuant analysts, reports The Block.
“Bitcoin has entered a ‘bullish pause’ phase: the Bull Score index has decreased from 80 to 60. Despite maintaining positive conditions, momentum has weakened,” they noted.
The bull market index assesses the market’s condition based on on-chain indicators. Values closer to 100 indicate strong demand, while those near zero suggest selling and pessimism. The current level of 60 indicates a temporary slowdown in the upward trend. However, the overall positive momentum remains.
Experts identified several factors indicating a pause in growth:
- stagnation of stablecoin liquidity — over the past 60 days, USDT inflow amounted to $9.6 billion, but the pace has slowed, indicating a reduction in new capital;
- profit-taking — the profitability indicator in the Bitcoin network has turned negative. Traders are locking in profits, and unrealized gains are decreasing;
- seasonal decline in activity — the traditional summer slowdown in trading is amplifying current trends.
If Bitcoin’s price continues to fall, the index could drop below 40 — this would be the first bearish market signal since April 2023, analysts noted.
New catalysts are needed to resume growth. CryptoQuant’s head of research, Julio Moreno, believes that a potential interest rate cut by the Fed in September could be one of the drivers.
Current Indicators
After reaching a new all-time high, Bitcoin’s price has decreased by 4.9%, according to CoinGecko. At the time of writing, digital gold is trading at $116,900.
Bitcoin’s value earlier briefly exceeded $117,000 following the signing of a new executive order on retirement savings by U.S. President Donald Trump.
Options expiring on August 29 indicated expectations of Bitcoin falling below $100,000.