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After a six-week absence, Bitcoin reaches $40K. However, on-chain activity remains'somewhat bearish'

BTC is now at $40,000 but not all data points indicate that there is a bullish impulse.

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After a six-week absence, Bitcoin reaches $40K. However, on-chain activity remains'somewhat bearish'

Bitcoin (BTC) touched $40,370 on July 26 as a solid day of gains saw the return of a major price milestone.

Daily gains in BTC prices close to 20%

Data from TradingView and Cointelegraph Markets Pro showed that BTC/USD touched $40,400 at one point before consolidating later in the day.

The pair held onto previous gains throughout the day and clocked in at $38,000. However, another surge occurred after the Wall Street open.

While there was some excitement among investors who waited for the upside to resume, Michael van de Poppe, a Cointelegraph contributor, cautioned against being too bullish at present levels.

"Bitcoin still showing strength, although sentiment is getting euphoric again while approaching the range resistance," he wrote just before $40,000 hit.

The market has made a higher high, and the trend has changed. If we don't break $41K, I believe we will still see a HL of $34.5-36K for the next few weeks.

This would be a departure from a trading range that has been in existence for more than two months.

An analysis of support and resistance levels on the major exchange Binance showed that there was very little buyer activity above $36,000 at the time. However, sellers still have $41,000.

Material Indicators provided the Binance data. They also suggested that moving averages should be considered when trying to understand current movements.

Bulls may be dampened by "quiet" activity on-chain

Although July 26's gains are impressive, van de Poppe wasn't the only one calling for a pragmatic assessment of the entire Bitcoin market.

In the latest edition of its weekly newsletter, "The Week On-chain," data analytics firm Glassnode likewise highlighted the need for on-chain activity to catch up with price performance in order to sustain the market.

Analysts wrote that "Overall, On-Chain Activity remains somewhat bearish" and continued to be quiet.

"Perhaps the Bitcoin network is slowing down prices. In a perfect world, increased volatility and positive price action would spark back demand for block space. It may indicate that a more cautious approach is needed in the coming weeks.

Bitcoin was last seen at $40,000 in mid-June, when it made a brief return to lower levels.

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