Bitcoins transaction volume is falling along with its price. At first glance, this sounds bearish because faint activity is usually the result of faint demand, lower participation and lack of momentum. However, technical analysis shows that the historical pattern carries a more complicated history.
Technical analysis by CryptoCon shows that Bitcoin’s trading volume strength is falling near the green low-volume band that indicated the bottoms of the previous cycle. The decline in trading volume is also a good thing for traders looking for the bottom of the cycle.
Bitcoin transaction volume drops to the lowest zone
Technical analysis Bitcoin volume shows that the trading volume strength indicator, which tracks the relative weight of Bitcoin’s on-chain trading activity relative to its price history, is shrinking towards the low-volume zone that reliably signals the end of a bear market.
As shown by the green bar at the bottom of the chart below, which is marked as a low trading volume area, vital lows have occurred after previous breaches of this area in 2015, 2018 and 2022.
Therefore, the current decline in transaction volume cannot be interpreted solely as a negative signal. Heavy trading activity often occurs closer to cycle peaks when the market is crowded. Examples of these transactions are shown in the chart below in 2017, 2021, and 2025. On the other hand, low transaction volume usually occurs when interest declines, which is a good sign.
However, according to cryptocurrency analyst CryptoCon, Bitcoin is not quite there at the bottom of the cycle, and the difference matters. In 2014, he spent 10 months in the channel at the same levels. The problem is that “close” is not the same as “confirmed.” Bitcoin may be entering the part of the cycle where sellers are tiring, but the data does not yet show a final reset of previous long-term lows.
What could this do to the price of Bitcoin
The immediate consequence is that the price of Bitcoin can remain defenseless in the low term. There are other data points converging in this direction as well, but they have not yet aligned. For example, it shows the MVRV Z-Score, an indicator that always marks cycle tops and bottoms that there is no bottom Already.
When the price drops and trading volume also decreases, it often shows that buyers are not yet moving in with enough force to reverse the trend. This agrees with the latest changes on the marketwith Bitcoin down 3.7% in the last 24 hours and trading at $74,520 at the time of writing.
First, Bitcoin’s price may continue to decline or remain under pressure. Then, as trading volume reaches the deeper low-volume band and stays there long enough to confirm exhaustion, the setup may start to look more like a cycle bottom within one month.
Featured image from Getty Images, chart from Tradingview.com
