As Bitcoin holds near $95,000, over 85% of its supply is now in profit, raising questions about whether the market is entering the final stretch of its current bull phase. On-chain indicators and trading activity are showing signs of elevated optimism—but also increasing risk.

A recent report by CryptoQuant’s Darkfost highlights the jump in the “supply in profit” metric—a gauge that tracks the percentage of BTC holders with gains on their holdings. Historically, when this number nears or exceeds 90%, it has marked euphoric sentiment levels that have often preceded local tops.

“Profitability strengthens uptrends—until it tips into excess,” Darkfost cautions.

This profitability surge comes after a strong rebound from a recent correction, when only 75% of holders were in profit.

Engagement Rising, But Not Yet at Peak Levels

User activity is showing positive momentum. Daily active Bitcoin addresses surpassed 800,000, an encouraging sign of rising participation. However, this figure remains well below previous cycle highs and may suggest the broader public has yet to fully reenter the market.

In the options market, rising open interest suggests traders are returning to risk. Between April 28 and April 30, Bitcoin’s open interest rose by $1 billion, while Ethereum added $150 million. However, implied volatility has declined, signaling that despite higher positions, traders are expecting smaller price swings.

Meanwhile, bullish positioning dominates sentiment:

• BTC calls outnumber puts 3:1
  
• ETH calls dominate with a 4:1 ratio
  
• Over 73% of BTC premiums are flowing into calls
  

This optimism could amplify gains—or fuel volatility if sentiment shifts.

Demand Momentum Paints a Warning

Despite bullish sentiment, a critical metric—30-day Demand Momentum—remains deeply negative, sitting at -483,860 BTC, per analyst Crazzyblockk. This suggests a growing divergence between long-term and short-term investor behavior.

When this value is negative, it means short-term holders are offloading, while long-term holders are stepping back. Such dynamics have historically aligned with distribution phases or tops.

Outlook: Pivotal Period Ahead

Bitcoin is approaching critical resistance at $98,000, with support holding around $85,000–$87,000. The RSI of 67 hints at near-overbought conditions, while momentum and MACD remain in bullish territory.

The next leg—either to $100K or a correction—may hinge on two factors:

1. Whether supply in profit surpasses 90%, pushing the market into euphoric overdrive.
   
2. Whether demand momentum shifts positive, signaling long-term holders are stepping back in.
   

For investors, the message is clear: stay alert, manage risk, and monitor short-term holder activity closely. The macro trend remains intact, but sentiment could shift rapidly.