In the first week of October, Bitcoin (BTC) reached an all-time high of $126,198, only to lose over $15,000 in value thereafter. Despite the massive liquidation wave in the crypto market causing sharp price declines, on-chain data suggests a potential upward movement in the coming days. Analysts highlight that Bitcoin’s selling pressure is gradually decreasing, indicating a nascent market equilibrium.
Declining Selling Pressure, Investors on Hold
According to on-chain analyst Axel Adler, the “supply in profit ratio” for Bitcoin has significantly declined in recent weeks. This ratio reveals how many investors could profit at the current price level. Adler notes that the amount of Bitcoin purchased below the current price in the last 30 days has decreased, reflecting a reduced desire among investors to sell at a loss and a weakening of market selling pressure.
While the market has not yet fully returned to pre-liquidation levels from early October, a noticeable reduction in selling has been observed in recent weeks. Analysts suggest this indicates the worst of the downtrend is over, and Bitcoin is regaining stability. Historical data shows that recoveries in similar periods often culminate in strong upward trends.
Institutional Interest Bolsters Bitcoin
At the time of writing, Bitcoin is trading at $111,616, marking a 0.32% increase in the last 24 hours. BTC tested a high of $111,850 during the day, exhibiting strong resistance despite low trading volumes. A 20.9% drop in volume resulted in transactions worth $40.43 billion, causing a supply crunch that could positively influence prices.
Institutional investor interest appears to be reigniting. JPMorgan’s latest move regarding Bitcoin underscores this interest, as the bank plans to allow its institutional clients to use BTC holdings as collateral by the end of 2025. This development might boost Bitcoin demand, supporting long-term price appreciation.
Additionally, the growth in BlackRock’s Bitcoin ETF applications and MicroStrategy’s recent BTC purchases indicate that institutional players are becoming active again. The ETF approval surge that began in late 2024 injected billions of dollars in new capital into the market. Experts believe that if this trend continues, Bitcoin could ascend back to the $120,000 range.
The recent reduction in Bitcoin’s selling pressure and the increase in institutional interest provide encouraging signals for investors. However, the market’s fragility remains a consideration. Maintaining the $110,000 support level is crucial for short-term direction. Experts view this period as an “accumulation phase” and emphasize the importance of a long-term perspective for investors.