- Bitcoin’s new all-time high is supported by less than half the capital inflows of its previous major rally
- Market leverage has surged to a one-year high, increasing the risk of a sharp, volatile correction
- Analysts like Robert Kiyosaki are now signaling caution and pausing their own buying at these levels
Bitcoin has entered a decisive phase in its current market cycle, pushing above $122,000 and igniting widespread optimism. But while the price surge has bulls celebrating, the dynamics beneath the surface reveal a troubling disconnect between the price action and the capital flowing into the market.
This has created a high-stakes environment where a powerful technical breakout is clashing with signs of underlying market weakness.
The Bull Case: A Clear Breakout with a $150K Target
Michaël van de Poppe highlighted the strong bullish impulse, noting Bitcoin’s breakout above $110,500 as a key signal. The price currently sits above $122,000, showing strength after bouncing off critical support zones near $100,400 and $105,500. These zones acted as reliable springboards, absorbing sell pressure and fueling the latest rally.
Consequently, the breakout has introduced a phase of heightened volatility. Traders should expect sharp pullbacks. However, these dips are likely to be short-lived, as they tend to get aggressively bought.
With RSI indicating overbought conditions and volume climbing, this volatility aligns with previous parabolic runs. According to van de Poppe, this breakout suggests that Bitcoin could target $150,000 as early as Q3, continuing its broader march toward a potential $250,000 peak.
The Red Flag: This Rally Is Fueled by Less Than Half the Capital
Despite the positive momentum, Ali Martinez points to a troubling disconnect between price action and capital inflows. Back in December 2024, when Bitcoin hit $100,000, more than $135 billion entered the crypto market. Today, even as prices surpass $118,000, only $51 billion in new capital has entered.
This significant drop in market participation may reflect reduced investor conviction or tightening liquidity. It also suggests that the current rally lacks the financial depth that supported prior highs. Without fresh capital entering, Bitcoin could face challenges sustaining its current pace or breaking through psychological resistance levels such as $125,000.
Related: Bitcoin Price Prediction: BTC Hits $122K as ETF Inflows and Geopolitical Risk Drive Breakout
A Powder Keg of Leverage
Adding to the risk, Martinez notes a massive surge in speculative behavior, with open interest across all exchanges reaching $40.2 billion.
Related: Bitcoin Beats Gold and Stocks in Q2: Here’s What CryptoRank Reveals
This is the highest in over a year and indicates rising leverage and trader expectations for a major move. Historically, such spikes often precede sharp price swings both upward and downward.
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