Bitcoin Hits New Record High as Analysts Debate Whether the Rally Has Peaked

Bitcoin surged to a new all-time high of $124,450 during early Asian trading hours on Thursday before retracing to around $121,670. The sharp move upward, followed by a modest pullback, has reignited debate among traders about whether the market has reached its peak or if the rally still has room to run.

While some technical indicators are flashing potential warning signs, on-chain data suggests that Bitcoin may not have topped out yet, hinting at the possibility of further gains.

On-Chain Data Points to More Upside

According to data from CryptoQuant, Bitcoin’s recent surge does not exhibit the typical signs of a market nearing exhaustion. Key overheating indicators such as the funding rate and short-term capital inflows remain well below levels seen during previous peaks. Profit-taking among short-term investors also appears limited, with the Short-Term Holder Spent Output Profit Ratio (STH SOPR) currently sitting at 1.01%.

This relatively low profit-taking rate indicates that short-term holders are realizing gains only modestly, a stark contrast to the heavy selling observed in past market tops. Funding rates, while positive, remain moderate, suggesting traders are confident but not overly aggressive. Analysts note that such conditions could allow the rally to extend before overheating risks emerge.

Some market models, including CoinGlass’s “30 bull market peak indicators,” even suggest Bitcoin could have room to climb toward $187,000 before entering overheated territory.

Technical Indicators Flash Warning Signs

Despite the bullish on-chain outlook, several technical analysts are urging caution. Captain Faibik, a widely followed market commentator, noted that Bitcoin’s run to record highs was accompanied by the appearance of a “9th TD sell candle” on the daily chart—a signal often associated with trend exhaustion.

Other patterns, such as a bearish divergence in the daily Relative Strength Index (RSI) and the emergence of a rising wedge formation, point to weakening momentum and reduced buying pressure. RSI readings across multiple time frames have reached overbought territory, with scores of 72, 71, and 70 on the four-hour, 12-hour, and daily charts, respectively.

The recent retreat from $124,000 to $121,000 mirrors previous pullbacks, such as July’s drop from $123,000 to $115,000, which also followed overbought conditions.

Outlook: Consolidation or Continuation?

While technical charts suggest the possibility of a short-term correction, RSI levels alone do not guarantee a trend reversal. Bitcoin’s volatility, combined with strong institutional interest and broader liquidity growth, leaves the door open for the rally to continue.

In the near term, traders will be watching whether Bitcoin can hold key support levels and absorb selling pressure. A sustained move above the recent high could confirm that the uptrend remains intact, while a deeper pullback might signal the start of a consolidation phase before the next leg higher.