Experts at the company believe that holding this level is essential to maintaining the bullish trend. The “ceiling” that needs to be broken for continued growth is $121,000.

Analyst AlphaBTC also highlighted the importance of the $110,000–112,000 zone.

According to him, a four-hour candle above this range is necessary for growth to resume. Otherwise, a pullback to $105,000 is likely.

Signs of Weakness

At the time of writing, Bitcoin is trading at $110,951 (–0.6% daily). The cryptocurrency has corrected 10.6% from its all-time high of $124,128, reached on August 14.

15-minute BTC/USD chart on Binance15-minute BTC/USD chart on Binance. Source: TradingView

Bitcoin’s buy-sell ratio has dropped to –0.945. Values below 1 indicate sellers’ dominance. CryptoQuant analyst Gaah noted this signals market pessimism. He recalled that similar levels were seen at the November 2021 peak, after which a correction began.

Network activity is also declining. According to Glassnode, the average monthly transfer volume fell by 13% — from $26.7 billion to $23.2 billion.

The firm believes that a drop below the yearly average of $21.6 billion would confirm weakening demand.

Market Cooling

The market has entered a “late cycle stage,” Glassnode analysts argue. This is evidenced by a high level of realized investor profits.

Georgiy Verbitskiy, founder of the TYMIO platform, told Decrypt he expects a “cooling period” that could last until September.

Investor sentiment is also being shaped by outflows from spot Bitcoin ETFs and macroeconomic risks. According to Ecoinometrics, if current outflows persist, the price could drop to $107,000 and even fall below the psychological level of $100,000.

Verbitskiy also does not rule out such a decline.

The expert advised against opening new long positions for now, noting that buying would only make sense after Bitcoin consolidates above $118,000.

Capital Inflows on Binance and Divergence from M2

Amid the sell-off, Binance users deposited $1.65 billion in stablecoins onto the platform. Large stablecoin inflows to exchanges often precede rising demand for cryptocurrencies.

According to CryptoQuant, this inflow coincided with the withdrawal of nearly $1 billion in Ethereum from Binance. Analyst Amr Taha noted this was the second time in a month that stablecoin inflows to the exchange exceeded $1.5 billion. He said this “highlights a new wave of capital entering the spot market.”

Bitcoin’s drop to $109,000 has also caused the sharpest divergence in two years from global M2 money supply trends. M2 measures the total amount of money in circulation.

Since the pandemic, Bitcoin has shown strong correlation with M2, typically with a lag of 2–3 months. Traders have used this relationship to forecast short-term price trends.

However, Real Vision founder Raoul Pal — one of the first to point out this correlation — stressed that in the long run Bitcoin is more closely tied to overall global liquidity, not just M2.

Note: Earlier, FORECK.INFO reported on massive outflows from crypto funds, with investors pulling $1.43 billion amid concerns over the Federal Reserve’s next policy move.