Bitcoin is consolidating between $104,000 and $116,000, with potential for an uptrend or correction based on key resistance and support levels, according to Glassnode.

Bitcoin Consolidates Between $104,000 and $116,000 Amidst Uncertain Market Sentiment

Bitcoin (BTC) is trading near $112,000, consolidating between $104,000 and $116,000, signaling potential for either an uptrend if it breaks $116,000 or a correction to $93,000 - $95,000 if it falls below.

Market Consolidation and Investor Behavior

According to a recent analysis by Glassnode Insights, Bitcoin is consolidating within the $104,000 to $116,000 range. This consolidation phase follows significant investor absorption, potentially setting the stage for either a revival of the uptrend or a further decline. The current market behavior reflects a constructive 'buy-the-dip' sentiment among investors, with Bitcoin trading near $112,000, effectively filling the 'air gap' between $108,000 and $116,000. Historically, the $104,000 to $114,000 band has served as a corridor for sideways consolidation preceding decisive trends.

Short-Term Holder Dynamics

Short-term holders experienced a sharp drop in profitability during recent sell-offs, with profitability levels falling to 42% before rebounding to 60%. The market is in a neutral but fragile state, with renewed momentum contingent upon Bitcoin reclaiming the $114,000 to $116,000 range. A recovery to these levels would likely restore broader short-term holder profitability and strengthen the bullish case.

Cooling Off-Chain Sentiment

Off-chain sentiment indicators present a mixed picture. Futures funding remains neutral but vulnerable to softening demand, while Bitcoin ETF inflows have significantly slowed. Previously, Bitcoin ETF flows were largely driven by directional spot demand. Inflows peaked with more than $51 billion entering Bitcoin ETFs in 2025, with a record single-day inflow of $1.18 billion that coincided with Bitcoin's surge above $118,000. Data revealed nearly $523 million in daily outflows, illustrating that the ETF channel can magnify both accumulation rallies and liquidation cascades. Bitcoin set an all-time high of $124,128 on August 14, before slipping back toward $114,679, with nine consecutive sessions struggling to reclaim the $120,000 threshold.

Bitcoin Accumulation Trend Score

The Bitcoin Accumulation Trend Score, which reflects the relative size of entities actively accumulating/distributing coins on-chain, indicates ongoing accumulation behavior. A score closer to 1 suggests larger entities are accumulating, while a value closer to 0 indicates distribution or non-accumulation. This metric assesses the relative buying strength across different wallet sizes, giving higher weightage to larger holders. To ensure accuracy, the metric excludes data from exchanges and miners.

Ethereum Exchange Reserves Decline

Ethereum (ETH) exchange reserves have dropped to their lowest point in three years as institutional demand continues to drain supply from trading platforms. Current holdings on centralized exchanges stand at approximately 17.4 million ETH, down nearly 10.7 million tokens since September 2022. Spot Ethereum ETFs have emerged as a primary driver of the supply shortage, attracting more than $13 billion in net inflows since launching in July 2024.

Regulatory and Institutional Landscape

The SEC and CFTC's joint statement marks a regulatory shift, allowing spot crypto trading on registered exchanges, enhancing market clarity. Institutional interest grows, with Millennium Hedge Fund investing $244 million in Bitcoin ETFs.