Bitcoin Struggles to Break Above $94K: Mixed Signals From Derivatives and Network Activity Paint Uncertain Picture

Bitcoin’s recent price action tells a story of indecision. The cryptocurrency initially pushed toward the $94,000 resistance level but ultimately retreated to $87,000, with selling intensity increasing as liquidity dried up. This pullback raises important questions about whether the rally has legs, or if consolidation is simply the market’s way of catching its breath before the next move.

Derivatives Tell a Nuanced Story

The derivatives market isn’t flashing panic signals—at least not yet. Futures open interest has ticked down only modestly, suggesting that traders remain engaged rather than bailing out en masse. However, perpetual contract CVD (Cumulative Volume Delta) has dipped below critical support levels, a clear indication that sellers have stepped up their game. This divergence is telling: institutional futures players haven’t capitulated, but spot and perpetual traders are showing hesitation.

On-Chain Activity: Active Capital, Weakening Demand

The on-chain picture is equally mixed. While the number of active addresses has plateaued, entity-adjusted transfer volume has surged past its upper threshold, revealing that meaningful capital movement is still occurring beneath the surface. This suggests that while fewer wallets are transacting, those that are moving coins are doing so in significant size.

Transaction fee pressure has eased noticeably, signaling reduced competition for block space—typically a sign that demand isn’t rushing back immediately.

Institutional Flows Offer a Lifeline

Bitcoin’s institutional backstop is holding, albeit barely. ETF inflows have cushioned the impact of the price decline, but the MVRV ratio (Market Value to Realized Value) has retreated from highs, and profit-taking indicators remain subdued. This suggests institutions are adding selectively rather than aggressively buying the dip.

The Verdict: Consolidation With a Side of Caution

Bitcoin is locked in a grinding consolidation phase. While some data points—like elevated entity-adjusted transfer volume and stabilizing ETF flows—hint at potential recovery momentum, the overall picture remains guarded. Market participants are clearly waiting for more conviction before the next directional move, leaving BTC vulnerable to either a fresh decline or a prolonged sideways grind until fresh demand emerges.