Bitcoin market dynamics showed signs of stabilization in the wake of a week marked by sharp price corrections and significant liquidations. The cryptocurrency, which reached a new all-time high of $124,496 earlier in the week, dipped to as low as $114,706 over the course of 48 hours, triggering widespread profit-taking and forced selling. According to Coin Glass, over $530 million in long positions were liquidated in the past 24 hours, with $124 million in bitcoin and $184 million in ether positions being wiped out [1]. The sell-off was exacerbated by macroeconomic concerns, particularly the unexpected rise in July wholesale inflation data, which cast doubt on the likelihood of a Federal Reserve rate cut in September [1].
Despite the short-term turbulence, key market participants appeared to remain cautiously optimistic. Top traders on platforms such as OKX and Binance maintained their long positions, and their long-to-short ratio remained stable following a minor reduction during the peak of the correction [4]. The resilience of institutional buyers was also reflected in continued inflows to spot bitcoin ETFs, which, although experiencing net outflows of $121 million on Monday, still saw $547 million and $2.9 billion in weekly net inflows for bitcoin and ether, respectively [1]. This underscores the sustained institutional confidence in the asset class, even amid short-term volatility.
On-chain analytics painted a mixed picture. Glassnode reported a growing divergence between institutional demand and price movements, noting that while ETF inflows persisted, on-chain fundamentals—such as volume and wallet activity—showed signs of weakening [2]. Additionally, the 30-day options skew for bitcoin reached a four-month high, indicating elevated fear in the options market [4]. However, historical data suggests that such skew levels have often been followed by sharp rebounds, providing cautious optimism among traders and analysts.
Market structure indicators also pointed to limited downside pressure. Stablecoin activity suggested that fear remained contained, with Tether trading at a 0.8% discount in China, indicating mild, but not severe, outflows from crypto markets [4]. Moreover, bid liquidity stacked around key support levels, including $112,000, potentially limiting further declines [2]. Keith Alan, co-founder of Material Indicators, noted that the 100-day simple moving average at $110,950 could serve as a critical support level [2]. If bulls manage to defend this range, a retest of the $118,000–$120,000 resistance band becomes more likely.
Investors and traders are now turning attention to the Federal Reserve’s upcoming Jackson Hole symposium, where Chair Jerome Powell is expected to provide further clarity on the central bank’s policy path [3]. The outcome of this event could determine whether bitcoin remains in a consolidation phase or regains upward momentum. With the broader cryptocurrency market down approximately 1.2% as measured by the CoinDesk 20 index and crypto-related stocks showing mixed performance, the next few days are poised to play a pivotal role in shaping market sentiment [1].
Source:
[1] Crypto Market Today (https://www.cnbc.com/2025/08/18/crypto-market-today.html)
[2] Bitcoin Sell Pressure Palpable (https://cointelegraph.com/news/bitcoin-sell-pressure-palpable-btc-bid-support-stacks-at-105k)
[3] Bitcoin, Ethereum Slip (https://finance.yahoo.com/news/bitcoin-ethereum-slip-as-crypto-markets-pull-back-after-hitting-2025-highs-155818704.html)
[4] Was the Bitcoin Price Bottom $114.7K (https://cointelegraph.com/news/was-the-bitcoin-price-bottom-dollar114-7k-data-suggests-it-s-time-for-a-reversal)
