No, the bull run is likely not over yet. Bitcoin (BTC) has pulled back from its record highs, and some alternative cryptocurrencies (altcoins) have seen profit-taking. However, this appears to be a typical bull-market breather, with analysts closely monitoring the bitcoin price action around $125,000. BTC hit record high on Sunday Over the weekend, BTC pressed above $125,000 in a tell tale sign of traders pricing an easier monetary and fiscal policy in the U.S. against the backdrop of the ongoing government shutdown. The market likely expects easier policies across the globe, including Japan, where the new PM is biased toward Abenomics, an aggressive easing strategy implemented by the former PM Shinzo Abe. The total crypto market capitalization rose to roughly $4.07 trillion, lifting the Fear and Greed index to 64. While that's an elevated reading, it falls well short of euphoric levels, which indicates that there is scope for more risk taking in the market. This leaves room for bullish follow-through without needing blow-off leverage to get there. The driver under the hood still looks like spot demand and ETFs rather than a one-day squeeze, especially as BTC’s move came on a Sunday which is typically a day of thinner liquidity and lower leverage. Less-than-usual liquidations of a relatively small $65 million on BTC-tracked futures lend credence to that opinion. However, a quick retreat on Monday still suggests that some traders are unwilling to hold onto profits for long. Profit taking in altcoins, BNB stands out BTC prices are down a little over 1% in the past 24 hours, with dogecoin (DOGE) and Cardano’s ADA leading losses among majors. XRP, BNB Chain’s BNB and Tron’s TRX were down as much as 2%, while ether (ETH) lost just over 0.5%. The outlier on a weekly basis remains BNB, roughly at $1,184 and up more than 17% over seven days, which tells us that rotations are still happening inside ecosystems when the base asset has a bid. What next? The increasing amount of dry powder, or stablecoin supply, supports the bullish case in BTC and and the broader crypto market. Reports show stablecoin supply expanded by a record amount last quarter — about $45 billion, with roughly two-thirds of new issuance on Ethereum — and that’s the dry powder you want to see if the market is to keep going higher. Add to that the backdrop of the ongoing U.S. government shutdown that can delay data and nudge central banks toward caution, and you get a narrative that aligns cleanly with the bullish picture on price charts. Focus on $125K Two expert reads mirror this setup. Nick Ruck at LVRG frames the move as a hedge bid tied to institutional flows and inflation anxiety in a take that’s consistent with ETF allocations re-accelerating on dips. Alex Kuptsikevich at FxPro notes the technical breakout and warns that long-term holders have been selling near these levels since July. Both can be true. A range break invites supply, and a trend only survives if fresh demand absorbs it. “The next step could well be an attempt to update historical highs approaching $125K,” Kuptsikevich noted. “At the same time, it is worth paying attention to the activity of long-term sellers, who have been actively selling near these levels since July: we may see a new episode of selling on the rise.” The trader in me is inclined to treat $125,000 as a magnet and a test. Reach it fast and fail, and we’ll know supply is still in charge. Grind into it while funding stays sane, and it likely gives way.
