According to CryptoQuant data, the most intense phase of this Bitcoin cycle is already in the rear-view mirror, and it stands out clearly when demand and price extension are analyzed together.
Instead of focusing on price alone, the charts highlight how the rally was built. During Bitcoin’s second major advance of the cycle, demand surged at an exceptional pace.
Apparent Demand expanded by roughly +1.68 million BTC, signaling aggressive net supply absorption. Coins were being taken off the market faster than they were being redistributed, a classic hallmark of late-stage bullish enthusiasm.
At the same time, price deviated sharply above its long-term statistical trajectory.
The Power Law Divergence Indicator reached +22.69, the highest level of overextension seen in this cycle. Historically, readings at these levels don’t mark healthy trend continuation, they reflect emotional excess, where momentum overtakes structural support.
What makes this phase notable is the combination of both extremes occurring together. Strong demand alone can support sustainable advances. Price overextension alone can unwind quickly.
But when maximum demand absorption aligns with peak overextension, it typically defines the most euphoric point of a cycle rather than the start of a new leg higher.
Since that peak, both indicators have cooled. Apparent demand has weakened, and divergence has compressed, suggesting the market has transitioned from expansion to digestion. This doesn’t automatically imply a bear market, but it does indicate that the conditions driving explosive upside no longer exist.
In Simple Terms
Bitcoin already experienced its most emotionally charged rally of the cycle.
What follows is not about excitement, but about rebalancing, where price, demand, and long-term structure have to realign before any sustainable move can develop again.
