Bitcoin is showing several features of an early bull market, according to New Huo Tech, though the firm said the market still needs proof that spot demand — not only short covering — can carry the rally forward.
The institute said the crypto market has moved into a high-level consolidation phase after breaking above its previous trading range, with Bitcoin holding around the $77,000 area. In its view, the recent move already reflects some early bull-market traits: a fast reversal from lower levels, a rapid advance, and price consolidation near earlier highs without an obvious breakdown so far.
Short squeeze and trend confirmation are not the same thing
New Huo Tech said the latest rise should not be read as a confirmed trend without qualification. It argued that part of Bitcoin’s quick rebound from lower levels was driven by forced short liquidations and short covering, which helps explain both the size and the pace of the move.
That, the firm said, does not necessarily mean long-term spot buying has fully returned. It listed three markers to watch next: whether spot Bitcoin exchange-traded funds can sustain net inflows at elevated levels, whether institutional allocation continues, and whether the Coinbase premium can turn positive again. Those signals, in its view, would help confirm whether spot demand is genuinely recovering.
ETF inflows and liquidations pushed the move higher
On the funding side, the report said spot Bitcoin ETFs recently recorded about $1.92 billion in inflows. At the same time, the market saw large-scale short liquidations, which helped drive the price move higher at speed.
New Huo Tech added that the risk-reward profile for chasing prices has been weakening as the Fear and Greed Index has climbed to a relatively elevated level. The key issue from here, it said, is not only whether price can keep rising, but whether spot buyers can replace short covering as the main force behind the market.
Technical indicators point to a possible pullback toward support
Technically, short-term moving averages have already formed a bullish alignment, according to the report. Still, with the recent advance coming quickly, price may need to pull back toward those averages. The RSI (14) stands at about 78, placing it in overbought territory, while Bollinger Bands have expanded sharply, reflecting rising volatility and an extended trend.
The next test, the institute said, is whether Bitcoin can find effective support near the middle band after a pullback. It identified short-term resistance at $78,500 to $82,000 and support around $73,500 to $72,400.
Macro conditions remain a major variable
The report said uncertainty around traffic through the Strait of Hormuz has pushed up expectations for energy prices and inflation. It also noted that the U.S. 30-year Treasury yield at one point rose to about 5.337%.
After that, the U.S. Treasury announced an expansion of buybacks for Treasuries with maturities of 10 to 30 years. New Huo Tech said that could help ease pressure from long-end supply in the short term, but added that the structural tension tied to the U.S. fiscal deficit and Treasury supply has not been fundamentally resolved.
Regulatory developments and Ethereum’s upgrade timeline are also in focus
On policy, the institute said the U.S. Securities and Exchange Commission has proposed a regulatory framework for crypto assets, while the Commodity Futures Trading Commission is advancing related regulatory and enforcement arrangements. The market is also waiting for Congress to hold the next procedural vote on the Clarity Act.
New Huo Tech said a clearer U.S. framework for crypto-asset regulation would improve policy expectations for compliant institutions and exchange-traded token markets. It also said that if Ethereum’s Glamsterdam upgrade is pushed back to the fourth quarter, that could weaken a near-term fundamental catalyst for ETH.
What the market is watching over the next 30 days
The report said attention over the next 30 days will center on several events: the procedural vote on the Clarity Act around Sept. 15, the SEC’s 60-day public comment period on its regulatory framework, the Jackson Hole central banking symposium, the September Federal Open Market Committee meeting, July PCE data, and August nonfarm payrolls.
It also noted that the U.S. Treasury will expand Treasury buybacks starting Sept. 9, a move that may offer temporary relief for long-end supply pressure, though broader macro volatility could remain significant.
New Huo Tech revisits its earlier market calls
The institute said its team has been signaling since mid-May that the market was gradually entering a more attractive risk-reward zone. It said that view was reiterated twice, on July 6 and July 13, when Bitcoin was still trading around $60,000.
According to the report, earlier signals — including whale buying on-chain, rising OTC trading volume, and concentrated short covering — reinforced one another and suggested the market was accelerating a structural transition from panic selling to longer-term accumulation.
Three forces New Huo Tech says could drive the next stage
Looking beyond the short term, New Huo Tech said the next phase of the market may be driven by three forces: reallocation demand after capital exits the overcrowded AI investment theme, fresh allocations from compliant institutions as regulation becomes clearer, and deeper allocation and trading links between stocks, bonds, and crypto assets as traditional financial assets are increasingly tokenized.
The firm said its current focus is on whether regulation, institutional capital, and spot demand can reinforce one another, and on exploring cross-asset quantitative strategies and asset-allocation opportunities within a compliant framework.
In its view, the short-term question is whether spot demand can take over from short covering. Over the medium term, the market needs to see whether capital reallocation, regulatory tailwinds, and institutional participation can persist. If those factors do come together, New Huo Tech said, the latest move would look less like a fast rebound driven by a short squeeze and more like the start of a new market cycle.