Bitcoin Torn Between Support and Resistance as ETF Outflows Intensify

Analysis of Bitcoin's Current Situation

Bitcoin remains trapped between strong support near $80,000 and heavy selling pressure above $88,000 as renewed ETF outflows and hotter-than-expected inflation data threaten its recovery.

On-Chain Data Suggests a Strong Recovery Structure

Glassnode data shows Bitcoin facing significant overhead supply from investors who accumulated during the past two years. The six-to-twelve-month holders carry an average cost basis near $88,000 and one-to-two-year holders near $100,000. Both levels have capped previous Bitcoin rallies, triggering declines of over 30% in January and roughly 25% after May's advance.

Bitcoin's Broader Recovery Structure Remains Intact

Despite concerns about institutional demand and break-even selling, Bitcoin remains above its spot ETF cost basis near $81,500 and True Market Mean around $78,000, maintaining its broader recovery structure. Binance order-book data shows strong buying interest near $80,000, while Glassnode identifies liquidation clusters below the same level and also around $88,000.

A Breakdown Below $80,000 Could Trigger Liquidations toward $78,000

A rally toward $88,000 could force short covering.

Is the Bull Market Recovery Still Intact?

Glassnode highlighted improving on-chain conditions supporting Bitcoin's recovery. Long-term holder realized losses have plunged 85% from their Aug. 12 peak, signaling easing selling pressure. Profitable coins being spent now outnumber loss-making coins four to one, reversing June's 12-to-one dominance of loss-making coins. Unlike the 2018 and 2022 bear markets, Bitcoin never closed below its Realized Price, suggesting limited capitulation.

Elevated Leverage Across Individual Altcoins Could Increase Liquidation Risks

Glassnode also warned that elevated leverage across individual altcoins could increase liquidation risks.