Bitcoin Futures Power Index Shifts to Neutral – Bullish Streak Ends as Traders Brace for Next Move

After months of relentless bullish momentum, Bitcoin's futures market finally hits the brakes.

The Bitcoin Futures Power Index—a key gauge of market sentiment—has cooled into neutral territory for the first time in 2025. Traders who rode the rally now face a pivotal question: Is this a pause or a reversal?

No extreme greed. No panic selling. Just the market catching its breath—before the next big swing.

(And let’s be real—Wall Street’s ‘neutral’ usually means ‘we have no idea, but we’ll charge you for the analysis anyway.’)

Neutral Futures Index Raises Odds Of BTC Cooldown

Adler notes that Bitcoin’s current positioning near its all-time high comes with a notable shift in derivatives sentiment. Adler warns that when the Bitcoin Futures Power index transitions from neutral into negative territory, it has historically coincided with market corrections. With BTC still holding close to record levels, the current reading increases the probability of such a shift.

The broader market remains hot, fueled by significant capital inflows and heightened trading activity. However, some analysts are beginning to speculate that bitcoin could face a short-term cooldown as momentum moderates and the derivatives market signals caution. While spot prices have been resilient, the loss of clear bullish signals in futures data has traders watching closely for signs of waning demand.

At the same time, Ethereum’s explosive rally—up over 200% since April—has shifted market dynamics into a new phase where leadership is no longer solely dictated by Bitcoin. ETH’s strong fundamentals, reduced exchange supply, and institutional accumulation have drawn capital and attention away from BTC, creating a more balanced market structure. This diversification of momentum could mean that even if Bitcoin stalls, the overall crypto market retains bullish energy driven by large-cap altcoins.

Bitcoin Price Analysis: Approaching Critical Level

On the 4-hour chart, Bitcoin (BTC) is trading at $119,967, posting a modest gain of 0.34% as it approaches the critical $120,000 resistance level. The recent rally has brought BTC closer to the all-time high of $123,217, which remains a significant hurdle for bulls to clear.

Price action shows a strong recovery from early August lows NEAR $114,000, with BTC now trading above its key moving averages — the 50 SMA ($117,269), 100 SMA ($116,893), and 200 SMA ($117,475). This alignment indicates a bullish short-term structure, with the moving averages potentially acting as dynamic support if a pullback occurs.

The market is currently consolidating just below resistance, suggesting a potential breakout attempt if buying momentum strengthens. However, the repeated rejections near $123K in recent months highlight the importance of this zone as a major supply area.

A decisive close above $123,217 WOULD likely trigger momentum buying and open the path toward new price discovery. Conversely, failure to break higher could lead to a retracement toward the $117K support cluster, where the 50, 100, and 200 SMAs converge.

Featured image from Dall-E, chart from TradingView