Bitcoin (BTC) has shown remarkable resilience, holding firm above the $110,000 mark this week. This stability can be attributed to strong spot demand from US investors, as indicated by the notable rise in the Coinbase Premium Index. The index reached a peak of 0.18, the highest level seen since March 2024, signaling that significant buying activity is occurring between the $100,000 and $110,000 price range.
Recent data from analysts highlights a surge in short-term holder (STH) accumulation during the recent market dip, with holdings increasing from 1.6 million BTC to 1.87 million BTC. This uptick suggests a confident stance among new investors eager to capitalize on perceived opportunities amidst ongoing market fluctuations.
However, the market is witnessing a contrasting trend as older coins, specifically those aged between two and three years, have begun moving onchain, with nearly 7,343 BTC being relocated this week. This movement indicates that some long-term holders may be taking profits or adjusting their portfolios, which could temporarily constrain Bitcoin’s upward momentum.
As these older coins circulate, the Short-Term Holder Spent Output Profit Ratio (STH-SOPR) remains below one, reflecting that many recent sellers are exiting their positions at a loss. This trend points to a cautious sentiment among short-term participants, who appear hesitant to commit further capital.
Additionally, Binance’s net taker volume indicates ongoing sell-side pressure, which may further hinder Bitcoin’s price recovery, despite the strong accumulation from other investor groups. The overall market sentiment appears neutral, but it closely aligns with the potential for near-term volatility.
Despite the selling pressures, the positive Coinbase Premium suggests that demand in the US spot market remains steady. This divergence between robust spot buying and short-term selling actions indicates that market participants are acting on differing perspectives, allowing Bitcoin’s price to maintain its current levels while awaiting a clearer direction.
Looking ahead, the derivatives market is preparing for potential volatility as supply tightens. Data reveals a record net outflow of 5,620 BTC over 30 days from exchanges, indicating a shrinking supply and long-term confidence among holders. However, a significant movement of 364,000 BTC into derivative exchange wallets, particularly on platforms like Bitfinex, Bybit, and Binance, suggests that traders are gearing up for leveraged positions.
This dynamic interplay between a tightening supply and increasing leverage hints at upcoming volatility in Bitcoin’s price action. While long-term sentiment remains bullish, traders should brace for heightened fluctuations as Bitcoin approaches a critical inflection point, setting the stage for potential market swings.
