Bitcoin’s KEY ratio hits cycle low – Bullish rebound in sight IF…

Key Takeaways 

Bitcoin’s Taker Buy/Sell Ratio just hit a cycle low, while funding remains flat despite bullish bets. Stock-to-flow and Long/Short data show rising scarcity and crowded longs.

The Bitcoin’s [BTC] Taker Buy/Sell ratio on Binance has plunged to 0.959, at press time,  its lowest point since the start of this cycle. Previously, similar drops to 0.963 and 0.97 marked significant turning points that preceded major rallies. 

However, extreme lows often suggest capitulation, where panic selling peaks, and can signal a potential bullish reversal, especially when broader sentiment turns overly pessimistic.

So, while overall market sentiment remains bearish, the recent dip below 0.96 may hint that smart money is quietly accumulating, anticipating a rebound as retail traders stay cautious or on the sidelines.

Why are Bitcoin Funding Rates still low?

Despite a noticeable increase in bullish bets, Bitcoin’s Funding Rates (FR) on Binance remained unusually flat, holding near 0.009%, at press time. 

This suggests that while more traders are going long, they are doing so without using excessive leverage. 

Typically, soaring FR indicate market euphoria and unsustainable bullishness. 

However, the current muted levels reflect a more cautious approach, which could allow for more stable upward movement if price begins to climb. 

Hence, this subdued funding environment may be a healthy sign, hinting that a rally could unfold gradually without the risk of immediate liquidation-driven pullbacks that often follow overleveraged conditions.

Source: Santiment

Is the Stock-to-Flow spike a long-term bullish omen?

Bitcoin’s Stock-to-Flow (S2F) ratio exploded to 405, at the time of writing, marking its highest point this year. 

The S2F model measures scarcity by comparing circulating supply to yearly issuance, and such a sharp spike reflects growing scarcity amid stagnant supply growth. 

Historically, high S2F values have preceded long-term price increases as Bitcoin becomes harder to accumulate. 

This trend reinforces the asset’s store-of-value narrative, particularly in times of rising institutional interest. 

While short-term movements may remain volatile, the S2F surge indicates robust fundamentals. 

Therefore, if demand gradually increases, this structural scarcity could provide the foundation for Bitcoin’s next long-term uptrend.

Source: Santiment

Are leveraged traders setting up the market for a shakeout?

At the time of writing, Binance’s Long/Short (account) ratio rose to 1.60, with 61.5% of traders now positioned long. This aggressive skew signals that a large portion of the market is betting on further upside. 

However, such an imbalance often creates risk of liquidation cascades if the price moves sharply against the majority. 

Historically, overleveraged longs can attract sudden selling pressure from large players, leading to short-term volatility. 

Therefore, while the current positioning reveals strong bullish sentiment, it also increases vulnerability to rapid corrections. 

If price stability is maintained, though, this aggressive positioning may accelerate upside through short squeezes and breakout momentum.

Source: CoinGlass

Could these metrics trigger Bitcoin’s next breakout?

The convergence of deep taker sell pressure, flat funding, and rising scarcity paints a mixed but potentially bullish picture. 

However, aggressive long positioning injects short-term volatility risk. If Bitcoin holds its current level without a major flush, these metrics could align to ignite the next breakout phase.