Finance

Bitcoin’s Dip Below $110,000: Is a Deeper Correction on the Horizon?

August 26, 2025, 10:12 AM

A downward-trending stock chart with red indicators, suggesting a decline in value.

As market anxieties mount, this bear market's downward trend is reflected in the grim financial outlook. By Miami Daily Life / MiamiDaily.Life.

Executive Summary

Bitcoin is struggling to hold above $110,000, experiencing a 10% pullback from its all-time high due to heavy profit-taking.

On-chain signals indicate mounting sell pressure in futures markets, with the Taker-Buy Sell Ratio predominantly negative since July.

Spot market participants are also retreating, as the Spot Taker CVD shows sellers dominating activity since August 18, increasing the risk of Bitcoin falling below $110,000.

The Story So Far

Bitcoin’s recent struggle to hold above $110,000 and its approximate 10% pullback from its all-time high are primarily attributed to heavy profit-taking that began around August 14. This downturn is further compounded by persistent sell-side pressure and diminishing demand across both futures and spot markets, as evidenced by on-chain data, reflecting a cautious sentiment and reduced bullish exposure among market participants.

Why This Matters

Bitcoin’s struggle to hold above $110,000, fueled by widespread profit-taking and diminishing demand across both futures and spot markets, signals a strong potential for a deeper price correction. This broad-based sell pressure reflects a cautious sentiment among traders, suggesting that the cryptocurrency could fall below key psychological and support levels in the near term.

Who Thinks What?

Futures market participants, as indicated by CryptoQuant’s Taker-Buy Sell Ratio, show a lack of conviction for a significant near-term Bitcoin recovery, with sell orders outweighing buy orders.

Spot market participants, tracked by Bitcoin’s Spot Taker CVD, are seen offloading assets, indicating that sellers are dominating and demand is reduced.

Overall on-chain signals and market dynamics suggest Bitcoin faces an increased risk of a deeper correction due to widespread profit-taking and diminishing demand across both derivatives and spot trading.

Bitcoin is struggling to hold above the $110,000 mark, experiencing a significant pullback of approximately 10% from its all-time high due to heavy profit-taking that commenced around August 14. On-chain signals now suggest that the leading cryptocurrency could face a deeper correction as market participants reduce their bullish exposure across both futures and spot markets.

Mounting Sell Pressure in Futures Markets

On-chain data indicates a persistent increase in sell-side pressure, threatening to push Bitcoin below the critical $110,000 psychological threshold. CryptoQuant’s Taker-Buy Sell Ratio, a key indicator for futures markets, has remained predominantly negative since July, currently standing at 0.96. This metric signifies that sell orders are outweighing buy orders, reflecting a lack of conviction among derivatives traders for a significant near-term recovery.

Spot Market Participants Also Retreating

The trend of reduced demand is mirrored in the spot market. Bitcoin’s Spot Taker CVD (Cumulative Volume Delta, 90-day), which tracks net buying and selling over a three-month period, shifted from “neutral” on August 18. Since then, it has consistently shown red bars, indicating that sellers are dominating spot market activity and offloading rather than accumulating assets.

Potential Price Levels to Watch

With demand weakening across both futures and spot markets, Bitcoin faces an increased risk of falling below $110,000. Should this occur, the next significant support level for BTC is identified at $107,557. Conversely, if buyers manage to regain momentum and initiate a rally, the price could climb towards $111,961, with a breach of this resistance potentially leading to a move towards $115,892.

Overall, Bitcoin’s current market dynamics are characterized by widespread profit-taking and diminishing demand across both derivatives and spot trading, signaling a cautious sentiment among traders as the cryptocurrency navigates potential further price adjustments.