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Crypto Potato 2025-05-27 10:30:10

Bitcoin at Risk of Sharp Pullback as Traders Take Profit: Bitfinex

Last week, bitcoin posted a new all-time high (ATH) that marked a significant recovery from lows seen in April. The pace and consistency of the rally led to BTC logging its seventh consecutive green weekly close, marking the longest such streak since October 2023. However, according to the newest edition of the Bitfinex Alpha report , that streak is about to be broken because traders are beginning to take profits. Also, BTC may struggle to thrive amid an unfavorable macroeconomic environment triggered by tariff tensions in the United States. Increased Possibility of Pullback Within 36 hours of hitting a new ATH, BTC witnessed a slight correction, falling below its previous high of $109,590. This retrace was attributed to reignited global trade war fears triggered by U.S. President Donald Trump’s proposal of 50% tariffs on European Union imports. While cryptocurrencies struggled with the effects of Trump’s tariff announcement, the Bitcoin perpetual futures market witnessed a flush as excessive leverage unwound. This added to the downside pressure on BTC and increased the possibility of a corrective move in the short term. Although the coming days will tell if BTC will stabilize above the $106,000 weekly lows, profit-taking by short-term holders could lead to a deeper reset before the next leg up. This is because investors tend to lock in gains when BTC records such a pace of appreciation. Short-term Holders Take Profits Bitfinex says there will be two types of sellers: those who bought the BTC dip and are sitting on profits, and those who were in losses during the last correction and are now above breakeven. These cohorts of investors are already taking profits, as seen in the on-chain data. As BTC recovered and rallied past $$93,400, which was the short-term holder (STH) cost basis, profit-taking accelerated. In the last 30 days, STHs have realized at least $11.4 billion in profit, with a daily peak of $747 million. This figure is a far cry from the $1.2 billion in cumulative profit realized within the previous 30-day period. Additionally, the surge in profit-taking is evident in the STH Realized Profit/Loss Ratio, which has risen to a level only seen on 8% of trading days in Bitcoinʼs history. “This dramatic shift highlights just how quickly investor sentiment and behavior can pivot when momentum returns. However, it also implies that some degree of consolidation is likely as the market digests this wave of distribution before attempting another leg higher,” Bitfinex analysts stated. The post Bitcoin at Risk of Sharp Pullback as Traders Take Profit: Bitfinex appeared first on CryptoPotato .

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