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Bitcoin operates within a ‘bullish neutrality’ framework as key indicators show improvement and short liquidations prevail, resulting in a managed upward pressure that remains relatively calm.
Summary
- The composite regime indicator is positioned at +16.3, well within the upper neutral band, a range that has historically yielded favorable 30-day returns in 2025 backtests.
- With short liquidations leading the market and long liquidations below 50%, the current upside pressure is primarily driven by the necessity for short covering.
- If the regime score drops below 0, along with a reversal in liquidation dominance, it would signal the potential end of the current trend and a resurgence of downside risk.
Bitcoin is currently priced around $88,100, with a 24-hour trading volume close to $34.3 billion, indicating consistent liquidity and narrow intra-day fluctuations across major exchanges. Market depth remains strong, with spot and derivatives trading facilitating smooth price discovery, despite minimal percentage changes over the last day.
Bitcoin price stable
The composite indicator, which integrates measures such as taker imbalance, open interest pressure, funding rates, ETF flows, exchange movements, and price trends on a scale from negative 100 to positive 100, is presently at +16.3. This positions the market within the upper neutral territory, which spans from positive 15 to positive 30.
Historical backtesting for 2025 shows that this particular subzone typically yielded average returns of +3.8% over 30-day spans. In contrast, the negative 15 to zero segment showed average returns of -1.5% over seven days. The indicator has rebounded from a recent bearish trend when it dipped to -27 a week ago.
The study notes that transitions into a formal bull regime, characterized by scores above +30, have historically correlated with local price peaks, leading to average negative returns of -3.3% over seven-day periods. This indicates that the current positive 15 to positive 30 range might pose less risk compared to higher values, as per the report.
The long/short liquidation dominance oscillator, assessing the disparity between long and short liquidation volumes, shows a current value of -11%, while its 30-day moving average is at +10%. Negative figures signify a dominance of short position liquidations, with long liquidation dominance registered at 44%, indicating that short liquidations are predominant, as per the analysis.
The dominance of short liquidations exerts upward pressure on prices since forced short positions necessitate buyers to cover their obligations, in accordance with derivatives market dynamics.
A decline of the regime score below zero, coupled with a shift of the liquidation oscillator into positive territory, would indicate a potential cessation of the current upward trend, the analysis warned. Historical evidence suggests that the negative 15 to zero zone returned an average of -1.5% over seven days.
The analysis describes Bitcoin’s present market condition as “bullish neutrality,” with the regime score at +16.3 and a derivatives landscape highlighting the prevalence of short closures propelling buying pressure.
