Bitcoin stops rising at $111,000? 5 things to know this week

Bitcoin has returned to a multi-week low as August comes to a close, and investors are busy setting new price targets for BTC.

Data from TradingView shows that the price action of BTC has been highly volatile since the market shock on Sunday, shaping the current trend.

BTC price chart 3 hours | Source: TradingViewThis has pulled BTC down to $110,700, the lowest level since July 10, becoming a "wake-up shock" for late Long positions.

According to data from the tracking platform CoinGlass, the amount of Long positions liquidated in the crypto market over the past 24 hours reached 640 million dollars at the time of writing.

Liquidation of cryptocurrency | Source: CoinGlassTraders are divided on the short-term outlook. While some expect Bitcoin to retest the previous all-time high (ATH) as a bounce point, others view the situation as more complex.

Trader Daan Crypto Trades emphasizes that a "significant retest" is currently taking place.

"BTC opened the week with a large CME gap today," he noted, referring to the weekend gap in the CME Group's Bitcoin futures market.

"This is the largest gap we have seen in many weeks. Recently, weekly opening sessions often have gaps, and most of them are filled on Monday or Tuesday."

CME Bitcoin futures ( 1 hour) | Source: Daan Crypto TradesTrader Jelle is one of those who believe Bitcoin could continue to drop further.

"Bitcoin is still taking down traders using leverage around the bottom of the range, and it seems that large investors are still not satisfied. I really want the price to hold this area; otherwise, we will fall back to the previous trading range, and that could open up another retest of the $100,000 mark," he warned.

Liquidating BTC | Source: CoinGlassOrder book data from CoinGlass shows that there is virtually no significant buying pressure just below the current price range as Wall Street opens the first trading session of the week.

Meanwhile, last week, an analyst suggested that the level above 100,000 dollars remains upheld as a support zone and has not even been challenged.

Whale distribution in a “healthy” state

The sudden price drop of Bitcoin on Sunday has brought whales back into focus. Current price levels still remain within 10% of ATH, proving to be attractive to big players looking to take profits from their long-held coin.

Last weekend, an organization sold a large amount of BTC after holding it for 7 years, causing the market to plunge by $4,000 in just a few minutes and it has yet to recover.

Data from blockchain analytics company Arkham, shared by the account Lookonchain on X, shows that this organization has rotated capital from Bitcoin to Ethereum (ETH).

In the past 5 days, they have sent approximately 22,769 BTC (, 2.59 billion dollars ) to Hyperliquid for sale, then purchased 472,920 ETH (, 2.22 billion dollars ) on the spot market and opened a Long position of 135,265 ETH (, 577 million dollars ), the report stated, while sharing the related BTC and ETH addresses.

Currently, the amount of BTC that this organization holds is valued at approximately 11.4 billion dollars, with a profit margin of up to 1,675%.

"The price is stabilizing simply because some whales have reached their magical number and started to offload. This is healthy — their supply is limited and their selling is necessary for the process of Bitcoin being fully monetized. Huge supply blocks, with massive purchasing power, are being distributed to the community. This cycle is one of the greatest monetization events in history," Bitcoin analyst Vijay Boyapati commented on the event.

Distribution of BTC supply by wallet entity | Source: Willy WooStatistician Willy Woo, who gained attention last month for selling his BTC, emphasized the influence that the oldest whales still have on market developments.

"Why is BTC increasing so slowly in this cycle? The current supply of BTC is concentrated around whales who have peaked their holdings since 2011 (orange and dark orange). They bought BTC at $10 or lower. Now, it takes over $110,000 in new capital to absorb each BTC they sell," he said along with the chart.

As reported, whale distribution activity has been clearly evident throughout the recent phase of the bull run. Data from on-chain analytics company Glassnode confirms that there are approximately 2,000 wallet addresses holding between 1,000 and 10,000 BTC as of Sunday, excluding the largest 'super whales'. This also marks a new high for August.

Number of Bitcoin whale addresses | Source: Glassnode## Small holders continue to accumulate Bitcoin

Observing other wallet groups, the on-chain analysis platform CryptoQuant sees reasons for the bulls to remain hopeful about a recovery. However, CryptoQuant warned on Monday that the distribution process has not yet fully occurred across the entire group of Bitcoin investors.

"After reaching a historic peak of 124,000 dollars, Bitcoin has entered a correction phase," collaborator BorisD summarized in a Quicktake blog post, predicting that this decline could "continue for a while."

Unlike whales, smaller hodler groups still maintain an "accumulation" mindset. Specifically, wallets holding up to 10 BTC continue to increase their holdings. In contrast, wallets holding between 10 and 100 BTC exhibit distribution behavior, collectively taking profits when the price reaches $118,000.

In the range of 100 to 1,000 BTC, market influence becomes significant, according to BorisD.

"Although generally still in an accumulation phase, they have shown a balance between accumulation and distribution since the $105,000 level, reflecting hesitation. This price level acts as an important support area that can be converted," he said.

Bitcoin accumulation activity compared to distribution by wallet group | Source: CryptoQuantThanks to the relatively large scale of participating wallets, CryptoQuant describes the current distribution as "a dominant trend".

"Distribution remains the dominant trend, but its intensity is decreasing as Bitcoin adjusts. The $105,000 level is the strongest zone. If the price falls into this area, it will create significant pressure on the market and could trigger widespread fear," the article concludes.

Has the bull market "ended"?

For some investors, there is almost no reason to expect a full return of the Bitcoin bull market. Those who have maintained a cautious stance on future price movements further reinforce their views as BTC drops to its lowest level since early July.

Among them is the famous trader Roman, who warns in his latest analysis that signals on higher time frames indicate that the best part of the bull run is over.

To support his assertion, he cited the inverse head and shoulders pattern that is forming, with the final "shoulder" still yet to appear.

"All we need to do is establish a reversal model to be able to enter a Short position. They will be stuck again in a low-volume pump. The bull run of BTC has ended," he predicted.

Previously, Roman and some others pointed out the decreasing trading volume and the weakening RSI (relative strength) data to reinforce the argument that Bitcoin has lost momentum. When the price reached a new peak, the RSI created lower highs again – a typical bearish divergence setup.

Last weekend, based on Wyckoff analysis, the trading account ZAYK Charts set a potential bearish target for BTC at $95,000.

"BTC is still moving exactly as Wyckoff predicted."

BTC price chart 1 day | Source: ZAYK Charts## The battle against inflation in the U.S. continues quietly

The "preferred" inflation index of the U.S. Federal Reserve (Fed) is about to be announced at a critical time for economic policy.

The Personal Consumption Expenditures index ( PCE ) for July is expected to be released on Friday, which will play an important role for both Fed officials and the market, who are looking for confirmation of the possibility of interest rate cuts next month.

Last week, at the Jackson Hole annual conference, Fed Chairman Jerome Powell unexpectedly shifted his stance from tightening to a more accommodative approach. Immediately, risky assets surged as expectations of an interest rate cut increased.

Since then, market sentiment has cooled down, as there is still a lot of inflation data to monitor before the mid-September interest rate decision.

The latest data from the FedWatch Tool of CME Group shows that the market probability bets for a 0.25% cut are nearly 90%.

The target interest rate probability of the Fed for the September FOMC meeting | Source: CME Group FedWatch ToolCommenting on this issue, trading company Mosaic Asset emphasized the words of Jerome Powell and the change in the Fed's approach to the 2% inflation target.

"If abandoning the average inflation targeting strategy means the Fed becomes less tolerant of inflation above 2%, then you shouldn't expect the Fed to signal easing. This will make the inflation reports and payroll data prior to the September interest rate meeting key data for the Fed," they stated in the latest issue of the regular newsletter The Market Mosaic.

Mosaic also believes that betting on multiple rate cuts could be an "inappropriate" strategy in the near future.

Meanwhile, Nvidia's earnings report on Wednesday could create volatility for the crypto market and risk assets, as the market expects positive business results.

"In summary, Nvidia will conclude a strong earnings report season, with attention gradually shifting to the Fed," trading source The Kobeissi Letter summarizes.

Dinh Dinh