Bitcoin has dipped below the $105,000 level, reflecting increasing selling pressure and a notable uptick in volatility as the cryptocurrency market enters a pivotal phase. Following months of resilience where key support zones were fortified, bulls find themselves struggling to regain traction, while bears attempt to push Bitcoin toward the psychological threshold of $100,000. Despite the pronounced pullback, Bitcoin continues to hover near crucial demand levels that have previously served as a springboard for significant upward movements, placing the market at a crossroads.
Data analyzed by the prominent analyst Darkfost reveals that short-term holders (STHs) are exacerbating the sell-off, with approximately 28,600 BTC being liquidated at a loss. This trend corresponds with rising capitulation pressure as participants with shorter investment horizons exit their positions amid fear and short-term panic, rather than proceeding with a conviction-driven strategy.
While longer-term on-chain metrics remain stable, the market is closely scrutinizing whether demand can absorb this wave of selling or if momentum will definitively turn in favor of the bears. With persistent macroeconomic uncertainty and declining liquidity across major assets, the immediate sessions are critical in determining Bitcoin’s near-term direction.
Short-Term Holders Under Pressure
Darkfost underscores that the short-term holder sector continues to be the primary catalyst for sell-side pressure in this current market phase. He suggests that we may witness further capitulation from STHs, as their SOPR (Spent Output Profit Ratio) remains around 1—a threshold historically indicative of indecision and anxiety.
When SOPR fluctuates near parity, it suggests that short-term holders are selling at or close to break-even, reflecting a lack of conviction to endure through price volatility.
This behavior aligns with a critical pattern: each time Bitcoin approaches the STH realized price of approximately $112,500, the market experiences waves of profit-taking or break-even selling. Instead of maintaining their positions through potential rallies, recent investors are quick to exit as prices rise toward their entry points.
This recurring supply response near the STH cost basis has essentially created a rotating ceiling for Bitcoin, impeding clean bullish continuations and rendering the price environment structurally heavy in the short term.
Darkfost notes that these market dynamics reflect doubt, fatigue, and a heightened sensitivity to price pullbacks among newer buyers. While long-term holders display steadiness and contribute minimally to sell pressure, the STH group remains cautious, reacting defensively to every price bounce—a behavior often preceding deeper market retrenchments or shakeouts before continuing trends.
BTC Testing Weekly Support with Weakening Momentum
The weekly chart for Bitcoin shows a discernible momentum shift, as prices slide toward the support area between $103,000 and $105,000, also testing the 50-week moving average following a protracted period of weakness. Several lower highs have developed from the peak near $127,000, indicating a gradual shift from a strong uptrend towards consolidation—and potentially a vulnerability in trend if buyers cannot defend current levels.
The latest weekly candle displays a sharp wick downward accompanied by elevated selling volume, highlighting panic-driven exits and short-term capitulation. Nevertheless, Bitcoin remains above a key structural support zone that successfully held during previous pullbacks earlier in the cycle, rendering this level critical for bulls.
A decisive break below the 50-week moving average could intensify the downward momentum, opening pathways for deeper retracement targets, potentially falling to $95,000 or even $88,000 if risk aversion escalates.
Despite recent price volatility, macro trends continue to lean bullish over the long term, with the 200-week moving average trending upward and residing comfortably beneath the current price. For now, the focus shifts to whether Bitcoin can reclaim the $110,000 mark in forthcoming sessions—an achievement that would suggest an absorption of selling pressure and mitigate the deterioration of market sentiment.
