Bitcoin’s price action lately has shown a pattern that in the past has indicated more upside. The bullish engulfing pattern since January 2021, for example, has formed 19 times. In 78% of those cases, it’s pushed prices to new local record highs. That uncommon technical indicator, along with positive bullish market conditions, has BTC on track for a very bullish outlook.
Bitcoin also closed Monday with a daily gain of at least 4.34%, which is enough to produce a strong bullish engulfing candlestick. The smaller bearish candle is totally engulfed by a larger bullish candle. This pattern is a marker that the sentiment of the market has turned from sellers to buyers. Bitcoin has continued holding this support on the $105,000 level for two days.
Since mid-November 2022, Bitcoin has absorbed more than $544 billion in new capital, illustrating a sign of returning investor confidence. This stampede of capital has propelled Bitcoin’s realized market cap to an all-time high of $944 billion. Realized market cap is used to determine the overall value of all existing bitcoins, using the last price at which each bitcoin moved. This method gives a much more accurate representation of market sentiment than using regular old market cap.
During the 2022 bear market, this bullish engulfing pattern was the last of four formations. These examples didn’t instantly reverse the national decline. Even under extreme market conditions, they show the trend unambiguously. Historically, this pattern has garnered great success. In 15 out of 19 cases, it resulted in local peaks for a very successful almost 78% success rate. There have been exceptions. In February 2022, three bullish engulfing patterns emerged without taking the market to new highs. Further back, in May of 2024 and March of 2025, we see two negative signals where signals didn’t create momentum to go up.
Since the collapse of FTX in November 2022, Bitcoin’s liquidity levels have recently returned to those found in December 2022. Bitcoin bottomed at $16,800 and doubled in three months in late 2022. Our internal network liquidity has surged to an all-time high of $944 billion. This increase follows reaching a cycle low last November 2022.
