Matrixport Research: Trading Environment Persists, But New Uptrend Cycle Still Awaits

Entering 2026, Bitcoin finds itself in a market phase distinct from the early-cycle rebounds of previous cycles. Although technical indicators have recently shown signs of recovery, allowing for a tactically more positive stance, the structural signals necessary to support a sustained bull market remain insufficient from a strategic perspective. Historical experience indicates that once the price falls below the one-year moving average, it often enters a more challenging trading range. Coupled with weakening incremental capital and slowing fund inflows, this cycle is more likely to transition into a market environment that requires selective opportunity identification and emphasizes trading discipline.

Super Whale Selling Continues: Orderly Distribution Points to High-Price Range

On-chain data indicates that long-term holders are still distributing their holdings in a sustained and orderly manner. Following the launch of the Bitcoin spot ETF in early 2024, "super whales" increased their buying during the initial price pullback. However, starting in October 2024, their behavior shifted markedly from "accumulation" to "distribution." On a cumulative basis, this cohort has since sold approximately $61 billion worth of Bitcoin and has maintained a net selling position over the past 30 days.

This selling pressure has largely been absorbed by medium-sized whale groups, resulting in price action characterized more by back-and-forth struggles within a high price range rather than a typical parabolic surge or panic-driven capitulation. Unlike the indiscriminate selling following the peak in Spring 2021, the current distribution is more orderly and aligns with the behavior of mature capital in the later stages of a cycle, suggesting Bitcoin is at least within a cyclical top range.

Weak Incremental Capital: Price Near TMMP Limits Upside Momentum

From a capital flow perspective, the core constraint of this cycle remains insufficient incremental capital. The 30-day net change in Bitcoin's Realized Cap has been declining steadily since its peak in late 2024. Despite multiple price rebounds in 2025, capital flows had already weakened beforehand. This divergence explains why previous rallies were difficult to sustain and implies that the current rebound is built on a relatively weak capital foundation.

Simultaneously, the growth of new addresses has slowed, indicating that the market has not yet attracted a significant wave of new investors, and broad-based retail participation has not materialized. The current Bitcoin price is near the True Market Mean Price (TMMP), suggesting weak willingness among incremental buyers to chase prices higher. Historically, sustainable rallies often require the price to move significantly away from the TMMP, accompanied by concurrent confirmation from capital inflows. If capital flows fail to catch up, the price is more prone to oscillate around the TMMP rather than breaking out to establish a new, higher range.

Overall, while the technical recovery allows for a tactically more positive stance, this uptrend should be viewed more as a tactical rebound rather than the start of a new structural bull cycle. Bitcoin still faces core constraints such as insufficient incremental capital inflows and continued selling by super whales, making it likely that upside potential will remain limited. In such an environment, market movements are more likely to present staged, trading-oriented opportunities rather than smooth trend extensions. Compared to previous cycles, this one has seen fewer new participants. The key to a sustained rebound lies not in "how many people" but in "how much new capital." Against the backdrop of weak capital intensity, risk management and discipline should still take precedence over a long-only, buy-and-hold strategy.

The views above are partly sourced from Matrix on Target. Contact us to obtain the full Matrix on Target report.

Disclaimer: Markets are risky; invest cautiously. This article does not constitute investment advice. Digital asset trading can be highly risky and volatile. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions based on the information provided herein.