As the third week of July begins, Bitcoin has reached a new all-time high of $123,000. The world’s largest cryptocurrency has seen a remarkable increase of about 13% in just the past week. This surge in the market, along with a significant influx of capital into spot Bitcoin ETFs, has sparked discussions about the possibility of a market euphoria phase. However, on-chain indicators suggest a more complex situation.
Despite the recent price surge, CryptoQuant’s proprietary “Greed Indicator” remains at mid-levels, indicating that broader retail participation has yet to fully materialize. The rHODL ratio, which measures long-term holder behavior and wealth distribution among investor groups, currently stands at 32%. This suggests that retail participants, often referred to as “prawns,” are still exercising caution. In previous market euphoria phases, there has been a significant influx of retail investors, a trend that is not yet clearly evident in the current cycle. Instead, the recent price momentum appears to be driven primarily by institutional flows, while retail investors seem to have been sidelined as the rally continues.
It is worth noting that in previous euphoric phases in the crypto market, there has been a pattern of mass retail entry after initial institutional-led rallies, which then led to parabolic price action. However, there are early signs of change, with the rHODL ratio starting to rise in recent days. This increase could indicate the emergence of a retail-driven phase, which could potentially set the stage for what some market observers refer to as “the last dance.” For now, the market seems to be on the edge of euphoria rather than fully in its grip.
Despite Bitcoin’s surge to a new peak, there has not been widespread panic selling, according to data from the Spent Output Profit Ratio (SOPR). While SOPR briefly spiked around July 3-4, indicating some profit-taking activity, it has remained consistently above 1 without significant declines. This means that while short-term holders are taking profits, the broader market is not rushing to exit positions. The fact that profit-taking remains controlled suggests a positive environment for price discovery, which supports the ongoing bullish trend in the market.
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