CryptoQuant warned on Tuesday that Bitcoin may be approaching a near-term correction despite confirmation of a new bull market, after short-term traders' on-chain unrealized profit margin reached its highest level in 21 months.
According to the report, Bitcoin's close above its 365-day moving average last week confirmed a new bull market, and the firm's Bitcoin Bull Score Index stands at an 'extremely bullish' 90 out of 100. However, after bitcoin reached an eight-month high of $87,400, several indicators suggest the rally is losing momentum.
CryptoQuant head of research Julio Moreno noted that the short-term traders' unrealized profit margin climbed to 33%, the highest since December 2024. 'Margins at similar levels have historically encouraged traders to take profits because more unrealized gains are available to lock in,' he said.
Profit-taking is already visible. Bitcoin holders realized 25,700 BTC in profit on Sept. 22, the largest single-day realized profit of 2026. Moreno added that similar profit-taking after a strong rally has historically preceded local market tops.
Selling signs have also appeared in the altcoin market. The seven-day cumulative number of altcoin inflow transactions rose to 76,000, the highest since Oct. 17, 2025, which was 11 days after bitcoin's previous all-time high. The number of addresses depositing altcoins on exchanges rose to 51,000 over the same period. Moreno said the increase was broad rather than driven by a small number of large wallets, adding: 'When holders move coins to exchanges, they usually intend to sell.'
Demand is also cooling. Apparent spot demand contracted by 170,000 BTC over the past 30 days, while speculative futures demand growth slowed from 164,000 BTC on Sept. 14 to just 16,000 BTC on Sept. 29. 'Without fresh demand, rallies struggle to extend,' Moreno wrote.
If a correction develops, Moreno sees the 365-day moving average near $80,000 as first support, followed by the 200-day moving average near $71,000 and the trader on-chain realized price around $67,000. He described a pullback toward these levels as a 'healthy consolidation' within a young bull market rather than a reversal, as long as support holds. 'Still a bull market — but showing signs of fatigue,' he concluded.
