Bitcoin’s explosive rally over the past month has brought renewed excitement to the market, with the asset climbing nearly 18% from $83,000 to a recent high of $111,000. But while the surge has thrilled investors, a growing number of analysts are warning that the market may be entering dangerously hot territory. One key metric now fueling those concerns is Bitcoin’s Price Temperature (BPT), which has climbed to 2.67—just shy of levels historically associated with market overheating.

The BPT, tracked by on-chain analytics platform CryptoQuant, measures how heated Bitcoin’s current price trend is relative to its historical averages. According to CryptoQuant analyst Axel Adler, this latest reading suggests that BTC is inching closer to a zone where major corrections have previously occurred. “The last two cycle tops saw BPT hit 2.75 and 3.57,” Adler explained, signaling that although the market isn’t at peak froth just yet, it’s getting close.

Historically, Bitcoin’s price has tended to correct when the BPT exceeds 3.14. With the current reading sitting at 2.67, there remains a buffer of about 0.47 points before BTC enters that danger zone. This gives some room for further gains, but also serves as a clear warning sign for traders relying solely on momentum.

However, the BPT isn’t the only indicator analysts are watching. Several other on-chain metrics are painting a more balanced picture of the current market outlook—suggesting that while caution is warranted, the rally might still have legs.

Take Bitcoin’s MVRV ratio, for example. This indicator, which compares the market value to the realized value of BTC, currently sits around 2.4. While higher than last month’s range of 2.13 to 2.41, it remains well below the 3.0 mark, which has historically signaled market tops and triggered sell-offs by long-term holders. As long as MVRV remains below this threshold, analysts believe the current uptrend could continue without triggering a wave of profit-taking.

Similarly, the Net Unrealized Profit/Loss (NUPL) metric, another key sentiment gauge, remains in relatively safe territory. At present, NUPL sits at 0.58, putting it squarely in the “belief/denial” zone. Bitcoin typically becomes vulnerable to large corrections when this number crosses above 0.75, entering what analysts call the “extreme euphoria” phase—something the market hasn’t reached yet.

Another critical long-term signal is the Pi Cycle Top Indicator, which uses moving averages to identify cycle tops. Bitcoin usually enters overheated territory when the 111-day Simple Moving Average (SMA) crosses above twice the 350-day SMA. That crossover hasn’t occurred since 2021. Currently, the 2x 350-day SMA is hovering around $160,000, while the 111-day SMA is still far lower at approximately $91,000—indicating there’s still significant room for upside before technical overheating sets in.

In simple terms, while Bitcoin’s BPT has moved into a high-alert zone, other indicators suggest that the rally isn’t yet exhausted. Short-term caution may be warranted, especially if the price moves swiftly beyond $115,000, but long-term bullish momentum remains intact.

Looking ahead, analysts see two potential outcomes. If Bitcoin maintains support above the $106,000 level and bullish momentum continues, a climb toward $120,000 could materialize in the short term. On the flip side, if profit-taking intensifies—especially as more metrics approach critical thresholds—a retracement back to the $106K range could occur before the next leg up.

For now, Bitcoin finds itself in a balancing act between sustained enthusiasm and emerging caution. Investors and traders alike would be wise to monitor not just price action, but the broader set of on-chain indicators that help reveal the market’s true temperature.