Bitcoin’s next major move may depend less on price levels and more on liquidity returning to the market. According to fresh analysis from on-chain data firm Glassnode, the current setup suggests Bitcoin (BTC) is still struggling to attract the kind of capital inflows needed for a sustained uptrend.
After several attempts to push higher in recent weeks, Bitcoin has failed to hold onto gains. Glassnode says the main reason behind these stalled rallies is weak buying pressure. While BTC has managed to defend key support zones so far, analysts believe the market is now at a turning point where liquidity conditions will decide what comes next.
One of the key indicators highlighted by Glassnode is Bitcoin’s profit/loss ratio, measured using a 90-day moving average. Historically, meaningful mid-cycle recoveries have only taken place when this ratio stayed well above 5. According to the firm, this level signals strong and consistent capital inflows, showing that fresh money is entering the market rather than prices rising on thin liquidity.
At present, however, the profit/loss ratio sits near 2 — far below the threshold seen during previous recoveries over the past two years. Glassnode warns that without a clear rise in this metric, Bitcoin’s upside attempts are likely to remain fragile.
Adding to the uncertainty is Bitcoin’s current supply structure. Glassnode estimates that roughly 22% of BTC’s circulating supply is now held at a loss. This figure closely matches conditions seen during notable correction phases, including the first quarter of 2022 and the second quarter of 2018. In past cycles, similar levels have increased the risk of further downside, especially if prices break below key support zones.
When a large share of supply sits underwater, investor behavior becomes critical. If confidence weakens, holders may choose to sell into rallies, increasing downward pressure. Glassnode notes that this dynamic could come back into play if Bitcoin fails to stabilize.
That said, not all signals point to heavy selling. Data from CryptoQuant shows Bitcoin inflows to Binance are currently near historic lows. This suggests that most investors are not rushing to move coins onto exchanges to sell. According to a CryptoQuant analyst, this reduces the likelihood of a sharp, aggressive sell-off in the near term.
While the risk of a short-term pullback remains, analysts believe any decline could be relatively limited unless liquidity conditions deteriorate further. For Bitcoin to shift into a clear and lasting uptrend, both Glassnode and CryptoQuant agree on one thing: the market needs a meaningful liquidity reset.
Until stronger capital inflows return and key on-chain indicators improve, Bitcoin may continue to trade cautiously, caught between resilient holders and the absence of fresh buying power.
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