Executive Summary
The Story So Far
Why This Matters
Who Thinks What?
Bitcoin (BTC) holders across various cohorts are reportedly engaging in widespread “distribution,” or selling, following a brief price rebound that evaporated over the weekend. On-chain data indicates synchronized sell-side pressure, leading to concerns about price stability, with the $105,000 mark identified as a critical support level that could prevent further significant declines.
Recent Price Action and Market Reversal
The cryptocurrency saw a sharp rebound last Friday, gaining 3.91% to $117,300 from $111,700. This surge was attributed to dovish commentary from the Jackson Hole symposium, which boosted overall risk appetite across financial markets and marked BTC’s strongest daily return since July 10.
However, this momentum proved short-lived, with Bitcoin quickly reversing its gains over the weekend and sliding to $110,600 by Monday. This reversal has been underscored by a bearish weekly engulfing candle, signaling potential downside vulnerability in the near term.
On-Chain Data Signals Distribution
On-chain data from Glassnode reportedly shows a broad shift into distribution among all Bitcoin wallet cohorts, indicating widespread selling pressure. The 10–100 BTC group has been a significant contributor to this trend, highlighting a uniform sell-side sentiment across various investor sizes.
Analyst Boris Vest further elaborated on this behavior, noting that smaller holders (0–1 BTC) have consistently accumulated since the peak, and 1–10 BTC wallets resumed buying below $107,000. In contrast, 10–100 BTC wallets turned into net sellers after the price surpassed $118,000, while large holders with over 1,000 BTC continue to distribute their holdings.
The 100–1,000 BTC group, however, presents a mixed picture, with a split between accumulation and distribution occurring around the $105,000 level. This makes $105,000 a crucial support zone, potentially acting as the last stronghold before a more significant market correction.
Realized Price and Downside Risks
Bitcoin’s realized price data further illuminates this inflection point, according to the analysis. The realized price for one to three-month holders is positioned at $111,900, while longer-term cohorts (three to six-month and six to twelve-month) have significantly lower cost bases at $91,630 and $89,200, respectively. This disparity suggests heavy short-term positioning near recent highs, contrasting with longer-term holders whose investments are anchored much lower.
Market analysis suggests that a sustained break below $105,000 could accelerate downside momentum. The absence of dense cost support between current levels and $90,000 might force recent buyers into capitulation, potentially leading the price toward the $92,000–$89,000 range as the next major demand zone.
Seasonal Tendencies and Analyst Concerns
This current pullback also aligns with Bitcoin’s historical seasonal tendencies. The period from August to September has often been a time of weakness, frequently exacerbated by Asia’s “ghost month,” which this year runs from August 23 to September 21. Cointelegraph previously reported that this period often coincides with softer risk appetite and increased profit-taking among traders.
Since 2017, Bitcoin has experienced an average decline of 21.7% during the ghost month, with notable drops of –39.8% in 2017 and –23% in 2021. Based on these historical averages, a retreat towards the $100,000–$105,000 range would be consistent with both seasonal patterns and established technical support levels.
Adding to the cautious outlook, crypto trader Roman Trading has highlighted structural risks within Bitcoin’s current rally. According to Roman, the BTC/EUR pair has not registered a new all-time high since last year, suggesting that recent upside may be more closely linked to a weakening U.S. dollar rather than robust organic demand for the asset.
Roman further warned that the enthusiasm following the launch of spot Bitcoin exchange-traded funds (ETFs) might be diminishing. The analyst observed that the higher-timeframe exhaustion patterns resemble past distribution phases, indicating a potential slowdown in buying interest.
In summary, Bitcoin faces mounting sell-side pressure from various holder cohorts, with on-chain data pointing to widespread distribution. While a brief post-Jackson Hole rally offered temporary relief, the market quickly reversed, highlighting the critical importance of the $105,000 support level. Coupled with historical seasonal weakness and structural concerns raised by analysts, the cryptocurrency could see further downside if key support fails.
