Bitcoin Under Stress as Liquidity Models Hint at $165K

Bitcoin opened December by tagging resistance and then falling while on-chain data shows heavy realized losses and a large gap from liquidity-based value. Together, these signals point to a market under sharp selling pressure at levels analysts link to past rebounds.

Bitcoin Capitulation Metric Spikes to Levels Seen Before Past Rebounds

Bitcoin’s capitulation metric has surged to its highest level of this cycle, mirroring conditions that preceded earlier market reversals, according to trader Rand. The on-chain gauge, shown in a Glassnode-style chart he shared, tracks periods when sellers lock in large realized losses relative to market size.

Bitcoin Capitulation Metric Spike. Source: Glassnode, Cryptorand

In the chart, the black line marks Bitcoin’s price while the red line plots the capitulation metric from early 2024 through late 2025. Each prior spike in the red line coincides with deep pullbacks in price, followed by medium- to long-term recoveries. Rand noted that “we witnessed exactly the same scenario before the previous bull reversals,” highlighting the current reading as one of the strongest on record.

At the same time, the latest move shows the capitulation metric climbing vertically as price retreats from recent highs near the upper end of the chart’s range. This pattern suggests a wave of forced or emotional selling as traders exit positions at a loss. Historically, such stress periods have marked exhaustion among weaker holders, leaving supply concentrated in longer-term hands.

However, the chart also shows that capitulation events can cluster and extend over time rather than mark a single turning point. Therefore, while the signal lines up with earlier bottoming phases, it does not pinpoint the exact timing of any potential recovery. For now, on-chain data indicates that Bitcoin is again in a zone where capitulation has played a key role in shaping the next phase of the market.

Bitcoin Liquidity Model Flags $165K Fair Value Gap, Analyst Says

Meanwhile, Bitcoin trades near $90,000 while a liquidity-based model now points to a fair value around $165,000, according to trader Michaël van de Poppe. In a post on X, he shared a chart titled “Bitcoin – Global Liquidity” and called the setup “the biggest mispriced condition we’ve seen in a long time in the markets.”

Bitcoin Global Liquidity Fair Value Model. Source: Michaël van de Poppe

The chart plots Bitcoin’s price as a white line against a green liquidity regression band. The band includes one- and two-standard-deviation zones, with a central line labeled “Global Liquidity.” As the model trends higher through 2023–2025, the fair-value line climbs above $150,000 while the spot price lags in the lower half of the range.

At the same time, the visual suggests that earlier in the cycle Bitcoin often traded closer to the midline of the liquidity channel. Now, the distance between the white price line and the model’s upper area is wider than in prior periods. Van de Poppe argues that this divergence captures how far current market pricing has fallen behind the level implied by global liquidity conditions.

Bitcoin Rejected at First Resistance, Analyst Eyes Move Back Above $90.3K

Bitcoin slipped lower after hitting its first major resistance zone, setting a monthly high in the opening minute of December, according to trader Jelle. In a post on X, he said Bitcoin “did exactly what we hoped it wouldn’t do” by stalling at the initial supply area overhead.

Bitcoin Support And Resistance Zones Chart. Source: Jelle

The chart he shared maps a series of gray support and resistance bands across the recent rally and subsequent sell-off. Price first bounced from a demand zone in the mid-$80,000s, then pushed into a resistance block around the low-$90,000 region, where the move failed. The rejection left Bitcoin trading back inside the same broader range, with the current candle hovering above the lower gray band.

At the same time, Jelle argued that the timing of the monthly high increases the odds of another test higher. Because the high for December formed in the first minute of the new month, he said there are “incredibly high odds we trade above $90.3K before EOY.” His scenario assumes Bitcoin can print a higher low at present levels and then drive back toward a reclaim of the broken resistance zone.