Bitcoin Bear Reversal Signal Emerges as $83,000 Supply Wall Looms
Bitcoin is producing its first meaningful cycle-reversal signal in eight months, but price has yet to confirm it.
Summary:
- Bitcoin Cycle Momentum has crossed above zero after eight bearish months.
- Glassnode sees $83,000-$86,000 as the main overhead supply zone.
- BTC still trades below key short-term moving averages near $77,443.
CryptoQuant’s Bitcoin Cycle Momentum has returned to positive territory at 0.4, while Glassnode identifies $83,000-$86,000 as the supply wall standing between BTC and a stronger recovery. Bitcoin traded near $77,443 on September 2, leaving the market in an unusual position: the long-term signal is improving before the short-term structure has broken bullish.
The cycle signal has changed, but it is barely positive
CryptoQuant contributor Gaah flagged the first positive Bitcoin Cycle Momentum reading after roughly eight months in negative territory.
The indicator compares CryptoQuant’s Profit and Loss Index with its 365-day moving average and is intended to distinguish bullish and bearish market regimes.
The latest reading is 0.4.
Historically, positive readings have coincided with bullish phases, while extended periods below zero have accompanied bearish conditions. But 0.4 is only an initial crossover, not the confirmation level the analyst is watching.
Gaah wants Cycle Momentum to rise toward 20-30 over the coming weeks, alongside continued BTC price recovery, before treating the reversal as confirmed.
That leaves Bitcoin with an early macro signal rather than a completed regime change.
Glassnode sees the harder test above $80,000
Onchain supply tells a less bullish near-term story.
Bitcoin’s August recovery pushed above $80,000 after the August 19 short squeeze, but the advance failed before reaching the dense long-term-holder supply concentrated around $83,000-$86,000.
Glassnode estimates that roughly 1.05 million BTC of long-term-holder supply sits inside that region.
The amount of profitable supply has also increased.
When BTC traded around $78,000 in May, approximately 65% of circulating supply was in profit. At roughly the same price in late August, that figure had risen to 68%.
That difference matters because more coins can now be sold profitably at the same BTC price. Summer accumulation effectively created another group of holders with gains available to realize as Bitcoin approaches resistance.
Options traders have stopped chasing the squeeze
Derivatives markets show the same loss of immediate momentum.
The 7-day 25-delta options skew jumped during the short squeeze as traders aggressively sought upside calls. It has since moved back toward neutral as BTC failed to extend the rally.
The 180-day skew remained comparatively stable.
In other words, short-term traders became less aggressive after the rejection, while demand for longer-dated optionality did not materially deteriorate.
September 25 could make that tension more visible.
Glassnode estimates roughly $14 billion in open interest across Deribit and IBIT options expires at the quarter-end date, with substantial positioning concentrated above $80,000. That expiry could become an important volatility anchor as BTC approaches the upper end of its current range.
BTC’s four-hour chart has not confirmed the reversal
The September 2 chart adds a shorter-term test.
Bitcoin trades near $77,443, below its 20-period SMA at $77,918 and 50-period SMA at $78,374.
That makes approximately $77,900-$78,400 the first resistance cluster before BTC can make another attempt at $80,000.
The 14-period RSI stands at 44.5, recovering from recent weakness but remaining below the neutral 50 threshold. Momentum has improved from the September 2 intraday low, yet buyers have not regained clear control.
The longer moving averages offer a more constructive picture.
BTC remains above its 100-period SMA near $75,648 and well above the 200-period SMA around $69,717. The four-hour structure therefore looks more like consolidation within the broader recovery than a confirmed breakdown.
A move above $78,400 would strengthen the immediate setup. Above that, $80,000 becomes the psychological hurdle before Glassnode’s more consequential $83,000-$86,000 supply band enters play.
Two signals are testing different parts of the cycle
CryptoQuant and Glassnode are not necessarily contradicting each other.
Cycle Momentum asks whether Bitcoin’s broader market regime is beginning to improve. The supply distribution asks whether enough demand currently exists to absorb holders waiting to sell at higher prices.
The first has just turned constructive.
The second remains unresolved.
That distinction makes the next BTC rally more informative than the initial Cycle Momentum crossover itself. A move toward $83,000-$86,000 accompanied by a rising momentum reading would put both signals on the same side.
Another rejection below the supply wall would leave Bitcoin with something less convincing: an improving cycle indicator inside a market that still cannot absorb its overhead sellers.
The information presented in this article is intended for informational purposes only and should not be interpreted as financial, investment, or trading advice. Coinspress.com does not promote or advocate for any particular investment strategy, asset, or cryptocurrency project. Cryptocurrency markets are highly volatile and unpredictable – always perform your own research and seek guidance from a qualified financial professional before making any investment decisions.
Alexander Zdravkov
Reporter at CoinsPress
Alexander Zdravkov is a market analyst and crypto journalist with interests in economics, broader financial markets and digital assets. His journey into crypto began more than four years ago, driven by a fascination with the rapid evolution of blockchain technology and the transformative potential of decentralized finance. He began analyzing market cycles and identifying emerging trends before they reach the mainstream. He holds a degree in International Relations - a background that helped shape his broader perspective on global economics, geopolitics, and the interconnected nature of modern financial markets. Whether covering the latest developments in the crypto sector or exploring broader macroeconomic themes, Alexander focuses on giving readers context rather than simply repeating headlines. During his career, he has authored more than 10,000 articles covering cryptocurrencies, traditional finance, and global market developments. His work spans everything from Bitcoin and altcoins to macroeconomic trends influencing risk assets worldwide.
