The recent bitcoin price increase towards $80,000 is showing signs of weakness, with low trading volumes and muted derivatives activity raising concerns about the sustainability of the rally. In a recent report, 10x Research head Markus Thielen highlighted the disconnect between the price movement and the underlying market participation. "Despite a 4.7% increase in bitcoin's price over the past week, the data tells a more cautious story," he noted.
Trading volumes have decreased significantly, with bitcoin's weekly volume 17% below average and ether's volume down 20%. Funding rates, which measure leveraged positioning, remain deeply negative.
Thielen stated that the price increase was driven by spot buying or short covering rather than leveraged long conviction, which is a key distinction. 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. The options markets support this view, with volatility falling into the lower quartile of its historical range and traders expecting relatively modest price swings over the coming week.
Ethereum's market also shows a similar picture, with even weaker participation and 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. Thielen believes that the near-term risk/reward is asymmetric to the upside if a catalyst emerges, which may come from outside the crypto space, with macroeconomic developments being a key factor in determining the direction in the days ahead.