Bitcoin’s Post‑Rally Trajectory: Expert Insights

In brief

• Bitcoin climbed above $72,000 Thursday, marking a nearly 15% increase since Monday.
• Analysts identified Treasury bond purchases, policy announcements, and a pronounced short squeeze as primary catalysts for the rally.
• As the short squeeze subsides, attention turns to spot demand, technical thresholds, and Treasury yield movements.

The surge past $72,000 erased billions of dollars in bearish bets, yet further upside will depend on fresh buying pressure.

Bitcoin hit its highest level since June on Thursday, rallying nearly 15% over the past week, with over $3 billion in crypto shorts liquidated. Moreover, spot Bitcoin ETFs recorded a $517 million inflow on Wednesday, their largest single‑day accumulation since May.

Julio Moreno, head of research at CryptoQuant, cited U.S. Treasury purchases of long‑dated government bonds and former President Donald Trump’s suggestion that the federal government could acquire Bitcoin as key drivers of the rally.

“The rally may prove sustainable if spot demand continues to expand after the initial impact of these macro developments,” Moreno told Decrypt. “We remain in a bear market, so a correction is possible, especially after such a rapid ascent.”

Moreno indicated he is monitoring Bitcoin’s 365‑day moving average, currently near $83,000, alongside CryptoQuant’s profit‑and‑loss index and bull score, neither of which has turned bullish.

“To confirm a bull market, I watch CryptoQuant’s P&L Index crossing its 365‑day moving average upward, which has not yet occurred, and a shift in CryptoQuant’s bull score into bullish territory,” Moreno explained.

Nansen senior research analyst Nicolai Sondergaard noted that Bitcoin’s technical outlook improved after reclaiming its 200‑day simple moving average near $69,000. The cryptocurrency now trades about 8% above its 20‑ and 50‑day moving averages, and its MACD indicator has turned bullish.

“The critical level is the 200‑day SMA near $69,000; holding above it validates the breakout, while a return below signals a failed move,” Sondergaard told Decrypt. “Resistance lies just above at the recent high of approximately $72,824.”

Sondergaard cautioned that much of the rally stemmed from liquidations rather than sustained buying, making Bitcoin vulnerable once the short squeeze exhausts.

Positioning remains mixed, he added, though whales and prominent figures on Hyperliquid are net long by $27.9 million and $33.9 million, respectively.

“The primary risk is that this spike was a short‑squeeze anomaly, not sustained inflows,” he warned. “When forced covering ends, thin follow‑through can reverse quickly.”

He further noted that trader sentiment is mixed and that a shift in narrative or broader risk‑off pressures could stall the rally.

Adam McCarthy, a researcher at crypto firm Lo:Tech, attributed the move to the Treasury’s expanded buy‑back program and the short squeeze, noting that over half of Wednesday’s gains occurred within a single hour as traders were squeezed out of a one‑sided short position.

“The Treasury’s buy‑back expansion gave the market a reason to reprice, but more than half of Wednesday’s increase came in one hour when a one‑sided short position was forced out,” McCarthy told Decrypt. “That catalyst is spent, so the next move must be driven by actual buying rather than squeeze dynamics.”

McCarthy said he is watching the 30‑year Treasury yield, particularly whether it revisits 5.3%, and crypto funding rates for signs of enduring buying pressure.

“In crypto, a genuine long premium in funding rates signals real buying activity,” he observed.

He warned that the short positions that propelled Bitcoin higher have largely been cleared.

“The short base is largely exhausted, and nothing has replaced it, meaning the rally that brought us here cannot repeat,” McCarthy said. “If dealers are short gamma at $70k, the hedging that amplified the move upward could amplify the decline.”

Bitwise Research analyst Ishmael Asad expressed a more optimistic view, calling the rally the strongest indication yet that Bitcoin has bottomed. He cited the Treasury’s expanded bond buybacks, the SEC’s proposed Regulation Crypto Assets framework, and this week’s White House crypto summit as catalysts.

“After this steep advance, I wouldn’t expect the same pace of growth to continue, but this move represents the strongest confirmation yet that the bottom is in,” Asad told Decrypt.

Asad noted that much of the potential downside, including the failure to pass the Clarity Act this year and possible rate hikes, has already been priced in, though additional catalysts will be needed for a full bull market.

“Markets are likely to trade sideways or higher in the coming months as we approach upcoming milestones, such as a possible Senate vote on Clarity in September,” he added.

CoinShares head of research James Butterfill also expressed caution, believing conditions will remain supportive but that Bitcoin is more likely to trade within a range than to launch a sustained breakout.

“The rally is primarily a macro story rather than a crypto‑specific one,” Butterfill told Decrypt. Recent inflation and employment data have reduced expectations for further Federal Reserve tightening, while large holders have ceased selling and begun accumulating again.

“We anticipate a constructive backdrop to persist, but we would characterize the market as range‑bound for now rather than in a sustained breakout, as accumulation by large holders remains insufficient to imply a durable breakout,” he said.

Digital asset investment products have attracted approximately $1.3 billion so far this week, yet Butterfill expects Bitcoin to stay range‑bound because large‑holder accumulation is not yet at a scale that would support a sustained breakout.

Butterfill noted that Bitcoin’s advance above its 200‑day moving average improves the technical outlook, with $80,000 emerging as a key level to watch.

“On the upside, the $80,000 region remains the critical boundary; a decisive move through it would likely require clearer confirmation from the Federal Reserve that policy risks have shifted away from further tightening,” he explained.

Monetary policy remains the biggest risk, he added, as persistent inflation could keep Fed tightening in place, undermining the liquidity backdrop that has supported Bitcoin’s rally.

“With accumulation by large holders still modest in scale, the market lacks the depth of conviction typically required for a durable breakout,” Butterfill said.

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