Bitcoin's recent surge has hit a critical juncture, with CryptoQuant Research Head Julio Moreno sounding the alarm on mounting correction risks. Moreno's warnings are grounded in a comprehensive analysis of both technical and on-chain indicators, highlighting a potential pullback as Bitcoin nears a pivotal resistance zone.
Moreno's firm, CryptoQuant, has been flagging the possibility of a pullback for weeks, citing several key factors. Firstly, high unrealized profits among traders, which reached a staggering 17.7% on May 5, the highest since June 2025. This elevated level of paper gains makes traders more inclined to sell into strength, especially as the rally approaches a widely watched resistance level. Secondly, a spike in profit-taking across spot and futures markets, further exacerbating the potential for a correction.
The 200-day moving average at $82,400 stands as a formidable bear market resistance level, mirroring the March 2022 scenario where Bitcoin rallied 43% before hitting this very same threshold. The parallel is not coincidental, as CryptoQuant emphasizes the importance of demand and profit-taking dynamics in this context. The current setup raises the question of whether history will repeat itself, with the market potentially resuming its downward trend post-rally.
A critical concern is the rise in unrealized profits, which, when coupled with weak demand, can lead to a distribution risk. CryptoQuant's analysis reveals that daily realized profits surged to 14.6K BTC on May 4, the highest since December 2025. Historically, such spikes during bear-market rallies have preceded local tops, as short-term holders accelerate selling into price strength.
The demand side of the market also remains a weak point, with the Coinbase Bitcoin Price Premium turning negative in late April and remaining below zero as Bitcoin approached $80,000. This indicates decelerating US investor demand, which has historically been a prerequisite for more durable Bitcoin rallies. The absence of sustained positive Coinbase premium suggests that the current move lacks broad-based US institutional conviction.
While spot demand has improved, it remains negative, with the contraction narrowing from minus 91K BTC in April to minus 11K BTC. CryptoQuant notes that this indicates conditions have become less severe but not strong enough to confirm sustained spot accumulation. The firm also highlights that demand growth appears concentrated more in speculative perpetual futures positioning than in spot buying.
If a correction develops, CryptoQuant identifies the main on-chain support level near $70,000, represented by the Traders' On-chain Realized Price. This level has historically acted as a resistance-turned-support band in bear markets, reflecting the average cost basis of short-term traders. As of the latest press time, BTC traded at $76,961, indicating that the market is still navigating this critical juncture.
In conclusion, CryptoQuant's analysis underscores the heightened risk of a correction as Bitcoin approaches a critical resistance zone. The interplay of technical indicators, unrealized profits, profit-taking, and demand dynamics suggests a potential pullback, raising questions about the durability of the recent rally. Investors are advised to exercise caution and conduct thorough research before making any investment decisions in the volatile cryptocurrency market.
