Bitcoin Faces Major Test As 37% Recovery Collides With Bear Resistance

Traders cashed out nearly $1.2 billion worth of Bitcoin in a single day last week — a sign that the recent recovery may be running out of steam.

On May 4, investors sold 14,600 Bitcoin, pushing daily realized profits to their highest point since early December.

Back then, Bitcoin hit that same average in March before sliding further into a prolonged decline. CryptoQuant’s latest research draws a direct line between that episode and today’s setup.

Unrealized profits among traders also spiked during the recent run-up. On May 5, profit margins reached over 17%, the highest reading since June of last year.

Bitcoin traders’ unrealized profit margins hit 17.7%, the highest since June 2025.

Data shows that figure mirrors conditions last seen in March 2022 — right before Bitcoin resumed its fall.

The combination of profit-taking and a historically significant resistance level has prompted CryptoQuant to flag the possibility of a trend reversal.

Outside the crypto market, broader economic signals are adding to the uncertainty. The US Labor Department reported that producer prices rose 1.4% in April, the steepest increase in four years.

Bitcoin has grown more sensitive to US economic data as Wall Street adoption has expanded, and the inflation report pushed the price down 2.3% in 24 hours to around $79,250.

If selling pressure does push Bitcoin lower, CryptoQuant puts the next major support around $70,000. That level reflects the average price at which all Bitcoin was last transacted and has historically shifted from resistance to support during bear markets.

At that point, short-term traders would have little unrealized profit left, removing much of the incentive to sell.

This can literally go both ways.

A return to Bitcoin’s all-time high of $126,000 is seen as almost inevitable, according to Maelstrom investment chief Arthur Hayes

Hayes pointed to money printing pressures linked to the Iran conflict and the escalating US-China race in artificial intelligence as key catalysts.

Both views reflect the sharp divide among market watchers as Bitcoin sits at a critical juncture.

Featured image from Mint, chart from TradingView