Bitcoin (BTC) enters the last week of August significantly below all-time highs, as traders are increasingly uneasy.
A massive long liquidation event returned $110,000 to play, with a new CME gap emerging as potential support for bulls.
Bitcoin whales are under observation after a substantial shift from BTC to ETH.
Smaller holders are accumulating, differing from the behavior of whales, according to analyses.
Recent BTC price movements have sparked discussions about the end of the entire bull market.
The Fed’s “preferred” inflation indicator is set to be released, as markets increase bets on rate cuts.
BTC price weakness raises speculation of $100,000 retest
As August concludes, Bitcoin has hit multi-week lows, driving market participants to devise new BTC price targets.
Data from Cointelegraph Markets Pro and TradingView indicates volatile BTC price action has characterized the market since Sunday’s sudden fluctuations.
As BTC/USD dipped to $110,700, it marked its lowest point since July 10, serving as a harsh awakening for late long positions.
Monitoring resource CoinGlass reported 24-hour crypto long liquidations at $640 million during writing.
Traders were divided on the short-term outlook; some anticipated a retest of previous all-time highs as a bounce point, while others perceived a more complex scenario.
Trader Daan Crypto Trades highlighted an “important retest” currently underway.
“$BTC opened with a significant CME gap today,” he observed, referring to the weekend gap in CME Group’s Bitcoin futures market.
“This is the largest we’ve seen in several weeks. We frequently open with gaps, and many of these have been filled on Monday/Tuesday.”
Another trader, Jelle, suggested a potential move to even lower levels.
“Bitcoin continues to wreak havoc on leveraged traders around the range lows; the sharks remain active,” he cautioned.
“It’s crucial for the price to hold this area, or we may revert to the previous range, risking another retest of $100k.”
CoinGlass exchange order-book data indicated limited bid support just below the price at the week’s initial Wall Street open.
Previously, Cointelegraph reported on an analyst’s confidence that support at $100,000 would remain intact.
Bitcoin veteran: Whale distribution “healthy”
Sunday’s abrupt BTC price drop refocused attention on Bitcoin whales.
Current price levels, still within a 10% margin of all-time highs, are attractive for large players looking to capitalize on long-held assets.
Over the weekend, one entity sold a significant BTC tranche after a seven-year hold, causing a $4,000 drop in a matter of minutes, a decline from which it has yet to recover.
Data from crypto intelligence firm Arkham, shared on X by analytics account Lookonchain, demonstrated this entity rotating from Bitcoin to Ether.
“In the past five days, they deposited ~22,769 $BTC ($2.59B) to Hyperliquid for sale, subsequently purchasing 472,920 $ETH ($2.22B) spot and opening a 135,265 $ETH ($577M) long position,” it summarized, detailing the involved BTC and ETH addresses.
The entity’s BTC is now valued at around $11.4 billion, marking a profit margin of 1,675%.
“No conspiracy is needed to explain the BTC price stagnation. It has stalled as several whales cash in after hitting their target,” Bitcoin enthusiast Vijay Boyapati commented on the situation.
“This is a healthy occurrence – their supply is finite, and their selling is essential for effectively monetizing Bitcoin. Large blocks of supply, paired with significant purchasing power, are being distributed throughout the populace. This cycle represents one of the greatest monetization events in history.”
Statistician Willy Woo, who previously garnered attention for his own BTC sales, highlighted the influence that the oldest whales still exert on market trends.
“Why is BTC rising so slowly this cycle?” he questioned alongside a chart.
“BTC supply is concentrated among OG whales who peaked their holdings in 2011 (orange and dark orange). It requires over $110k of new capital to absorb each BTC they sell.”
As reported by Cointelegraph, whale distribution has been evident throughout the latest bull run phase.
Onchain analytics firm Glassnode confirmed that, as of Sunday, there were 2,000 addresses holding between 1,000 and 10,000 BTC, excluding the largest “mega” whales. This set a new high for August.
Smaller Bitcoin holders are still accumulating
Examining other wallet groups, onchain analytics platform CryptoQuant highlights reasons for bulls to remain optimistic about a potential rebound.
It pointed out that distribution has not yet fully materialized across the Bitcoin investor landscape.
“After reaching its ATH at 124K, Bitcoin has entered a pullback phase,” contributor BorisD summarized in one of its Quicktake blog posts, forecasting that this retracement may “persist for some time.”
Smaller holder categories, particularly wallets containing up to 10 BTC, continue to accumulate.
Conversely, holders between 10 and 100 BTC have shifted to profit-taking en masse as the price approached $118,000.
Those holding 100 to 1,000 BTC exhibit considerable market influence, according to BorisD.
“While primarily in accumulation mode, they have demonstrated a balance between accumulation and distribution since 105K, reflecting uncertainty,” he remarked.
“This level serves as a critical support-turning zone.”
Due to the size of the wallets involved, CryptoQuant labeled the distribution trend as now “dominant.”
“Distribution remains the prevailing trend, but its intensity is diminishing as Bitcoin pulls back,” the post concluded.
“The 105K level stands as the strongest zone. A decline to this area could induce significant market stress and trigger widespread apprehension.”
Is the bull market “over” already?
For some market participants, there appears to be minimal reason to anticipate a full revival of the Bitcoin bull market.
Those with conservative views on future price movements have reinforced their stance as BTC/USD fell to its lowest since early July.
Among them is the well-known trader Roman, whose recent analysis cautioned that high-timeframe signals indicate that the best days of the bull run may be behind us.
He cited a head and shoulders reversal pattern developing, with the final third “shoulder” yet to form.
“We simply need the reversal pattern set-up to potentially consider shorts. They’ll likely become trapped in a low-volume pump once again,” he predicted.
“The $BTC bull run is over.”
Previously, Roman and others noted declining volume and weakening relative strength index (RSI) data to substantiate the claim that Bitcoin has lost its momentum. As new highs were achieved, RSI recorded lower highs, indicating a classic bearish divergence set-up.
Earlier last week, referencing Wyckoff analysis, trading account ZAYK Charts suggested a potential downside target for BTC/USD at $95,000.
“$BTC is still behaving exactly as Wyckoff predicted,” it remarked in an update.
US inflation struggles loom in the background
The Federal Reserve’s “preferred” inflation measure is imminent, coinciding with a crucial juncture for monetary policy.
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The July reading of the Personal Consumption Expenditures (PCE) Index, due Friday, will be vital for both Fed officials and markets hoping for clarity on interest-rate cuts next month.
Last week, during its annual Jackson Hole symposium, Fed Chair Jerome Powell made a surprising shift from his hawkish stance. Risk assets surged as expectations for a rate cut began to take hold.
Since that moment, sentiment has cooled, with significant inflation data pending before the mid-September rate decision.
The latest figures from CME Group’s FedWatch Tool places the likelihood of a 0.25% cut at nearly 90%.
Commenting, trading firm Mosaic Asset emphasized Powell’s choice of words and the Fed’s evolving stance on its 2% inflation target.
“If discarding average inflation targeting indicates that the Fed is less tolerant of inflation above the 2% mark, then a dovish tone from the Fed would be unexpected,” it noted in its recent newsletter, The Market Mosaic.
“This will render upcoming inflation and payrolls reports crucial for the Fed ahead of the September rate-setting meeting.”
Mosaic cautioned that betting on multiple upcoming rate cuts might be “misguided” as a strategy moving forward.
Meanwhile, Wednesday’s Nvidia earnings are expected to inject volatility into crypto and risk assets, with anticipated strong performance.
“Nvidia is poised to conclude an overall robust earnings season while attention turns to the Fed,” trading resource The Kobeissi Letter summarized.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
