BTC Drops to $117,477 Amid U.S. Policy Shift and Liquidations
Bitcoin's rally paused this week as U.S. policy changes triggered a pullback. The cryptocurrency reached an all-time high of $124,457 on August 13, then dropped to $117,477 before stabilizing around $119,000.
- The 5% decline followed comments from U.S. Treasury Secretary Scott Bessent, ruling out additional government Bitcoin purchases, leading to $1 billion in leveraged liquidations.
- On-chain data suggests potential for another price increase, as exchange netflows decreased, indicating reduced selling pressure from long-term holders.
Short-Term Bitcoin Holders Show Strength Amid Volatility
- Short-term holders (STHs), holding Bitcoin for 155 days or less, have shifted towards accumulation rather than selling.
- The rebound of the STH Spent Output Profit Ratio (SOPR) above the neutral line indicates coins moved by STHs are being sold at profit without triggering large-scale sell-offs.
- This trend is viewed as a stabilizing factor that may support higher prices in the coming weeks.
Derivatives Market Points to Aggressive Buying
- In the last 24 hours, BTC saw $24.28 million in short liquidations compared to $17.16 million in long liquidations, with trading volume increasing by 65% to $149.47 billion.
- Options volume surged by 128% to $9.43 billion, and the taker buy/sell ratio reached a monthly high of 1.16, indicating strong buying activity.
- Positive funding rates show traders are willing to pay premiums for long positions, reflecting confidence without excessive leverage risk.
- The NVT Golden Cross metric has declined significantly, historically signaling upcoming strong rallies.
Resistance is at $122,190, while support is near $115,892. A breakout above resistance could lead to a retest of $124,457.