Bitcoin has moved out of its capitulation phase and into a transition zone, according to Swissblock. The cryptocurrency hit a five-week high of $65,700 on Monday, but analysts caution that a full recovery isn't confirmed yet. BTC was trading at $65,500 at the time of writing, up 1% on the day.
The capitulation zone
Bitcoin had been stuck in a capitulation regime since early June, when it fell below $70,000. The current cycle low came at the end of June, around $58,000. Since then, BTC has gained about 12% over the past three weeks. Swissblock says the asset is now in a transition area — momentum is rebuilding, but confirmation hasn't arrived.
CryptoQuant analyst Darkfost noted that Bitcoin has spent 95% of its time at a higher MVRV ratio, indicating it is significantly undervalued at current levels. That's a data point that suggests the selloff may have been overdone.
The $65,000 ceiling
Trader Daan said the $65,000 level has capped price for July. But he also pointed to higher lows forming, which could signal a breakout is imminent. Bitcoin remains within a seven-week range-bound channel, currently testing resistance at the upper bounds.
Alphractal CEO Joao Wedson laid out the next key level: if BTC breaks above $66,000, the next target is $66,700 — the Structural Midline. That's where bears may try to regain control, he said.
The next test: reclaiming the ignition line
Swissblock says the immediate challenge is to reclaim what it calls the 'ignition line' — a technical threshold that, if cleared, would push Bitcoin above the 'next inflection point'. That inflection point is likely around the $66,700 area Wedson highlighted. Until then, the transition zone remains just that: a transition, not a breakout.
Bitcoin's recent gains have been steady but not explosive. The question now is whether the momentum can carry through the resistance or if the market will settle back into the range. The coming days will show whether the bulls have enough fuel to push past $66,700.
