After staging a sustained rally from its February low, Bitcoin recently hit resistance near the $82,000 mark—just above its 200-day simple moving average (SMA)—before swiftly reversing course. When this key threshold proved insurmountable, the price quickly dropped to around $77,500, drawing parallels to a failed rally in 2022 that followed a 43 percent surge.
Weakening support behind the rally
A new report from blockchain analytics firm CryptoQuant highlights why the latest uptrend in Bitcoin could not be maintained. According to the company, the April and May rally was driven by leveraged futures, spot market demand, and inflows into US-listed Bitcoin ETFs. However, all three pillars have lost momentum in recent weeks. Notably, CryptoQuant’s “Bull Score” index plummeted from 40 to 20—a level they classify as highly bearish—and this echoes the pattern observed when Bitcoin prices stagnated between $60,000 and $66,000 earlier this year.
Coinbase premium turns negative
Another key indicator, the “Coinbase Bitcoin premium,” stayed in negative territory throughout the May rally and subsequent correction. This metric shows whether Bitcoin is trading higher on Coinbase—a popular US exchange—compared to overseas platforms. When the premium is positive, it signals robust American demand, but the persistent negative values indicate flagging investor interest in the US market.
Glossary: The “Coinbase premium” measures whether Bitcoin trades at a higher or lower price on the US-based Coinbase exchange compared to international platforms. A positive reading suggests strong local demand in the United States, while a negative reading indicates weaker interest from domestic investors.
Selling pressure from US and Korea
There has also been a visible decline in US-listed spot Bitcoin ETFs. Data from SoSoValue shows cumulative outflows of $979.7 million from these investment products in the seven days ending May 19. The prior week, net outflows were close to $1 billion. This turnaround comes after six consecutive weeks of positive inflows, suggesting a significant shift in the market’s direction.
Meanwhile in South Korea, the “kimchi premium,” which tracks Bitcoin’s price premium on local exchanges, has slipped into negative territory, signaling a waning appetite for Bitcoin among Korean investors.
CryptoQuant analysts noted that persistent price pressures in both the US and Asian markets, together with slowing local demand, continue to weigh down Bitcoin prices.
Asia’s muted impact offers no relief
In Asia, three Hong Kong-based spot Bitcoin ETFs saw just a few million dollars in daily volume throughout May. The generally low trading activity further undermined any effort for a broader price revival.
Key support at $70,000
Looking ahead, the report states that if Bitcoin’s correction deepens, $70,000—a level that coincides with the average on-chain cost basis for traders—will serve as critical support. Previous rallies in October and January also halted at this threshold, and market observers are keen to see if Bitcoin can hold this line once again.
