Bitcoin is facing a critical test as it struggles to hold its ground at the crucial $100,000 mark. Recent analysis from Glassnode reveals a dip below the $112,500 level, indicating the end of the recent bullish momentum. This 21% decline has left the market in a fragile state, raising concerns about further downturns.
Experts point to declining demand near $100,000 as a key factor driving this market volatility. With 71% of Bitcoin’s supply currently profitable below short-term costs, it aligns with established standards for corrections. Glassnode data suggests the $88,500 range is crucial support, echoing past market consolidations.
Long-term investors have begun offloading their positions recently, a trend that could signal a loss of confidence in market forecasts. This shift is reflected in the reduction of 300,000 BTC held by long-term investors since July.
Why are institutional investors pulling back?
Recent data from US Bitcoin ETFs shows daily outflows ranging between $150 million to $700 million. This marks a significant shift from the heavy inflows observed earlier in the fall. The decline in institutional engagement highlights changing market dynamics.
Further analysis reveals that:
– Spot exchange data indicates ongoing selling pressure, with major platforms like Binance experiencing net outflows. Coinbase remains relatively stable.
– Futures markets have seen a reduction in leveraged positions, shifting towards neutral strategies. Derivatives traders are favoring hedging over speculative longs,
These dynamics suggest that the current market landscape is characterized by volatility and strategic repositioning. Glassnode highlights: “A persistent downturn in institutional interest and strategic offloading by long-term holders mark the current phase of the market.”
The struggle for Bitcoin to maintain its $100,000 position remains a key focus point for investors and analysts alike as the market navigates these uncertain times.