Bitcoin's market signals shift, with shrinking futures-spot gap hinting at potential bullish reversal - IcoHolder.

On-chain data from CryptoQuant suggests that Bitcoin may be on the brink of a bullish trend reversal as key market signals begin to shift. In an April 13 post, CryptoQuant contributor Joao Wedson pointed to a narrowing gap between Bitcoin’s futures price and its spot price on Binance, a key indicator known as the perpetual-spot gap. This gap, which measures the difference between the price traders are paying in futures contracts and the actual spot price of Bitcoin, is currently negative, signaling that futures market participants may be taking profits or exercising caution after Bitcoin’s recent surge to nearly $90,000.

However, the shrinking gap could suggest that selling pressure is starting to ease. Historically, when this gap has turned positive, Bitcoin’s price has experienced significant upward movements, as seen in 2020 and early 2024. Despite Bitcoin’s 22% drop from its all-time high of $108,786 in January, on-chain accumulation signals remain strong. According to Glassnode, approximately 40,000 BTC was purchased near the $79,000 level, and about 51,000 BTC was accumulated around $82,080. These levels may serve as support if Bitcoin’s price declines again.

At the time of writing, Bitcoin is trading at around $84,746, recovering from a weekly low of $74,773. The cryptocurrency has gained 7% in the past week, and it recently closed a daily candle above a long-term downtrend line. This has led well-known market analyst Rekt Capital to speculate that a breakout could be imminent, although a successful retest of this level will be required to confirm the trend change.

Bitcoin’s market dominance, which measures its share of the entire cryptocurrency market, currently sits at 63%, according to TradingView data. This indicates that a significant portion of market capital is still tied to Bitcoin, suggesting that investors view it as a relatively stable asset in volatile market conditions. If buying activity continues and the futures gap turns positive, analysts believe Bitcoin could be poised for another rally.