Bitcoin Market Dynamics: A Closer Look at Key Support Levels and Accumulation Trends
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Bitcoin’s Resilience Amidst Selling Pressure
Bitcoin is currently navigating through renewed selling pressure. Despite this bearish trend, bears find it challenging to breach the crucial $110,000 support level. This price point has become a pivotal arena for market participants, as investors closely observe whether the bulls can maintain their dominance. Amid the prevailing market volatility, Bitcoin’s resilience at this level has sparked speculation. Many believe that once this current selling wave subsides, Bitcoin could be set for a robust upward movement.
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While traders grapple with the fear of further market corrections, a sense of optimism persists. There is a widespread belief that Bitcoin’s fundamental demand is solid enough to support higher price levels over the long term. Notable analyst Axel Adler has recently shared insights that could sway the market sentiment towards a bullish outlook. Adler suggests that, by filtering out market noise, the centralized exchange (CEX) market appears to have cooled down when analyzing exchange flows. This cooling trend, marked by a significant drop in gross activity from previous peaks, indicates fewer speculative actions and suggests a transition towards what Adler describes as “HODL mode.” Such a scenario could mitigate downside risks and pave the way for momentum driven by accumulation.
Signs of Accumulation in Bitcoin Exchange Flows
Axel Adler highlights a notable shift in Bitcoin’s exchange dynamics, indicating a significant change in market behavior. The Flow Activity Pressure is currently at 9, placing it in a lower zone. This suggests subdued overall flow activity, pointing to reduced speculative movements on centralized exchanges. Adler notes that the average Gross flow (Inflow + Outflow) is now at 70,000 BTC, a stark reduction from the peak of 266,000 BTC observed in March 2024. This decline suggests a quieter market environment, characterized more by accumulation than by intense trading activity.
Furthermore, Adler observes a Net Flow 30D Z-Score of -0.7, indicating a moderate purchasing bias relative to the annual baseline. This suggests that the Bitcoin entering exchanges is largely being absorbed, with demand effectively consuming the available supply. Adler emphasizes that “everything that comes to exchanges gets bought up,” as reserves are being used to meet the steady demand from buyers.
This pattern of activity often signals underlying strength in Bitcoin’s market structure. While short-term volatility remains a concern, the reduced flow activity and consistent absorption of supply suggest an accumulation phase. In the broader perspective, this dynamic supports the thesis that Bitcoin is preparing for a continuation of its upward trend once market sentiment shifts back in favor of buyers.
Technical Analysis: Testing Crucial Support
Bitcoin (BTC) continues to face selling pressure, with its price currently hovering around $111,802. The 12-hour chart indicates that BTC is nearing a critical support zone, just above $111K, which has been tested multiple times in recent months. A breach below this level could lead to more profound corrections, potentially reaching the psychological $110K mark or even the 200-day moving average near $105K.
The moving averages reveal mixed momentum. The 50-SMA is declining, pointing to near-term weakness, while the 100-SMA and 200-SMA remain below the current price, still indicating a longer-term bullish structure. This suggests that although bears are exerting pressure, bulls have not entirely lost their grip on the market.
On the resistance front, BTC continues to face a barrier near $118,000, a level it has failed to surpass during multiple attempts over the summer. Only a decisive breakout above this area would confirm a renewed bullish momentum.
In the short term, volatility is expected to remain high as traders assess the durability of this support zone. Maintaining a position above $111K would reinforce the bullish outlook, while a dip below this level could shift sentiment towards a more extended correction.
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