Bitcoin Enters Cooling Phase as On-Chain Sell Signals Flash

The Net UTXO Supply Ratio indicator issued four consecutive sell signals at the end of May 2025. This coincided with a sharp drop in the UTXO Ratio from recent highs — a typical pattern suggesting reduced holding incentive and increased likelihood of distribution by investors sitting on unrealized profits.

Key Technical Scenarios Identified

Adler outlines two potential scenarios for Bitcoin’s near-term price movement. The primary outlook favors a period of sideways consolidation, with BTC expected to fluctuate between $95,000 and $105,000. This range would allow time for on-chain metrics to normalize, particularly the Net UTXO Supply Ratio stabilizing between 0.85 and 0.9.

An alternative, though less severe, scenario points to a possible dip toward the $92,000–$96,000 zone. This correction could test the 200-day moving average near $94,700 or fall into a known buy-order cluster at $92,000. Such a move would help release pressure built up from overbought conditions following Bitcoin’s recent all-time highs.

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Market Needs to Reset After Profit-Taking Surge

Adler concludes that a reset is now needed, with momentum slowing and demand trailing behind a rise in supply. On-chain activity reflects a maturing phase of the rally, rather than sustained bullish continuation, and short-term caution may be warranted.

The analysis reinforces the view that while Bitcoin remains structurally strong, short-term overheated signals demand a phase of cooling before the next major trend can develop.

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