Bitcoin is gearing up for the $120,000 mark: the proportion of new investors is 30%, not yet reaching the overheating threshold, on-chain data indicates that the bull run still has room.

Bitcoin (BTC) price continues to consolidate below $120,000, with on-chain data showing that new investors (holders < 6 months) have steadily increased their share to 30%, still far below historical market overheating levels (60%-70%). Analysts point out that the current market is in a "healthy late bull cycle" — incremental funds continue to get on board (new liquidity) while long-term holders (LTH) are only moderately selling (coefficient 0.3), keeping the supply-demand structure balanced. Although the mainstream CEX premium turning negative suggests weakening short-term momentum, under macro liquidity support, BTC still has the potential to rise. As of the time of writing, BTC is reported at $118,371, with a slight increase of 0.6% in 24 hours.

New investors account for 30%, bull market overheating alert not sounded CryptoQuant analyst Axel Adler Jr.'s latest on-chain analysis shows that the Bitcoin New Investor Dominance is gradually rising, currently around 30%. This value is still significantly away from the historically indicative "danger zone" (60%-70%) that signals an overheated market. This metric measures the intensity of new funds entering the market by tracking the activity share of addresses holding coins for less than 6 months.

(Source: CryptoQuant)

The charts provided by analysts clearly show that the last two local market tops were accompanied by a surge in this indicator:

1. March 2024: New investors account for 64%, BTC peaks and retraces.
2. December 2024: The indicator surged to a peak of 72%, and BTC once again formed a phase top. The common feature of these two pullbacks is: after the new incoming liquidity is exhausted, long-term holders (LTH) begin to take profits on a large scale, intensifying the downward pressure on prices.

The supply and demand structure is healthy, long-term holders are moderately rotating their holdings The current market structure stands in stark contrast to historical overheating phases:

• New funds continue to flow in: Although the proportion of new investors has risen to 30%, it remains in a healthy range, indicating that the market has not yet entered a frenzy phase (a characteristic of the late bull market), leaving room for price rise.
• Long-term holders orderly exit: The chart shows that the selling coefficient of long-term holders (LTH) who have held coins for ≥3 years is only 0.3, indicating that this portion of "old chips" is being absorbed by the market at a controllable pace (healthy turnover), without triggering severe price fluctuations.
• Low Risk of Collapse: From a long-term perspective, the market supply and demand maintain balance, and the risk of veteran holders capitulating is low.

AxelAdlerJr summarized: "If the indicator accelerates its growth and approaches the historical range of 0.6-0.7, one should be wary of a pullback triggered by profit-taking. Currently, the market is still in a healthy late bull cycle - new funds are getting on board while old players have not yet initiated large-scale selling."

Short-term concerns: Mainstream CEX premium turns negative, US buying cools down Despite the on-chain long-term indicators being optimistic, some short-term signals indicate that the upward momentum may weaken:

• Mainstream CEX Premium Turns Negative: CryptoQuant analyst ArabChain confirmed that the mainstream CEX premium difference for Bitcoin (which usually reflects the price difference between U.S. compliant platforms and other exchanges) has recently ended its long-term positive status and turned negative. This indicator turning negative typically indicates that the purchasing willingness of U.S. institutions/large investors has cooled at the current price level (U.S. capital inflows have slowed).
• Technical pressure: BTC continues to be resisted at the key psychological level of 120,000 USD and needs to accumulate strength to break through.

Macroeconomic support remains, focus on key indicator changes Despite doubts about short-term momentum, positive macro factors may still drive BTC to new highs:

• Global Liquidity Support: Historically, Bitcoin prices have shown a positive correlation with the expansion of global M2 money supply. In the current macro environment, the ample liquidity pattern remains unchanged, still providing potential upward momentum for crypto assets.
• Key Observation Points: Investors should closely monitor whether the proportion of new investors accelerates towards the 60% warning line, and whether the premium difference of mainstream CEX can return to positive (indicating the return of buying from the US).

Conclusion: Bitcoin's consolidation around the $120,000 mark reveals a delicate balance within the bull market cycle. On-chain data shows that the share of new investors at 30% has not yet reached historical overheating thresholds, and the moderate selling by long-term holders maintains a healthy supply-demand structure, laying the foundation for future upward movement. However, the mainstream CEX premium gap turning negative raises short-term alarms, suggesting a weakening of the inflow momentum from U.S. funds. With macro liquidity support, whether BTC can break through strong resistance to reach new highs will depend on whether new capital can continue to flow in and effectively absorb profit-taking pressure. Investors should closely monitor the dynamic changes of the two key indicators: the share of new investors and the mainstream CEX premium gap, as a barometer for assessing market heat and potential turning points.