Bitcoin's recent push towards $80,000 is showing signs of weakness, with low trading volume and muted derivatives activity raising concerns about the rally's sustainability. In a recent report, 10x Research head Markus Thielen highlighted a disconnect between the price movement and underlying market participation, stating that the 4.7% increase in bitcoin's price over the past week tells a cautious story.
Trading volumes have dropped significantly, with bitcoin's weekly volume 17% below average and ether's volume down 20%. Funding rates, which measure leveraged positioning, remain deeply negative, with Thielen noting that the move higher was driven by spot buying or short covering rather than conviction from leveraged long positions.
This distinction is important, as spot buying tends to be more stable but less explosive than leveraged trades, leaving the market without the momentum typically seen in strong bull runs. Institutional flows have been a positive factor, with bitcoin ETFs recording nine consecutive days of inflows, resulting in total April inflows of $2.5 billion. However, Thielen warned that the rally's structure remains fragile, with the market shifting to a low-funding, low-volume regime that historically reflects hesitation rather than momentum. Options markets reinforce this view, with volatility falling into the lower quartile of its historical range and traders pricing in relatively modest price swings over the coming week.
Ethereum's market also shows a similar picture, with volumes dropping over 50% and derivatives positioning indicating limited appetite for risk. Despite these signals, the setup is not outright bearish, and the risk of forced liquidations on the downside is reduced due to limited leveraged long positions. The key factor that could determine the direction in the days ahead is macroeconomic developments, and for now, bitcoin's rally appears intact, but it may struggle to hold unless broader market conditions provide support.