Key Takeaways
Bitcoin checks assist with OI close to extremes, stablecoin flows sidelined, and sentiment reset hinting at a possible contrarian setup.
Bitcoin [BTC] is clinging to key assist as worth motion chopped in indecision. Over the previous week, it printed two decrease lows, with the twenty fifth of August rebound try failing to stay.
The outcome?
BTC down 4% on the week, tagging an eight-week low at $107,452. Nevertheless, Open Curiosity spiked to $84.93 billion, signaling excessive leverage.
That’s why a liquidity sweep was all however inevitable.
In line with AMBCrypto, this reset might set the stage for a restoration leg or pave the best way for a deeper drawdown. Both approach, the stakes are excessive, and market endurance is sporting skinny.
Danger-off tone deepens as Bitcoin breached assist
A clear break beneath $110k was all it took to flip sentiment.
Bitcoin’s Concern & Greed Index simply printed a four-month low at 39 (Concern), sliding from 50 (Impartial) solely a day earlier. Capitulation hadn’t hit but, however conviction was clearly thinning.
On the flip facet, the final three dips into this zone had triggered robust rebounds.
Most significantly, when the index hit 42, it fueled a rally to BTC’s then-ATH of $123k in lower than three weeks.
Supply: Glassnode
This time, although, there’s a key divergence.
Within the final three rebounds, the $107k–$110k vary lined up with ‘Greed,’ signaling overheated positioning and topping threat. Now, the identical zone is being examined underneath ‘Concern,’ pointing to a sentiment reset.
Merely put, what was as soon as a resistance ceiling is now performing as potential assist. Technically, that flip usually units up Bitcoin’s contrarian rebound constructions, particularly if liquidity begins clustering on the bid facet.
Liquidity build-up raises threat of a bull lure breakdown
Stablecoin minting is a strong proxy for liquidity flows.
Over the previous three days alone, issuers have pumped out a mixed $4 billion in provide.
But, BTC has saved shedding back-to-back assist ranges, displaying that recent liquidity isn’t biking straight into spot bids.
Including weight, web USDT outflows hit $915 million on the twenty seventh of August, lining up with BTC’s 3.67% drawdown over the following 48 hours. Briefly, the $110k dip wasn’t absorbed as bids stayed skinny.
Supply: Glassnode
In that case, Bitcoin’s fading threat urge for food is leaning bearish.
Spot bids are skinny, liquidity’s parked on the sidelines, and sentiment’s caught in Concern.
All in all, no clear backside but. The $2 billion short wall at $115k continues to be untouched, displaying bulls aren’t gunning for that liquidity.
Till they do, upside appears to be like capped. Bitcoin stays susceptible to a deeper drawdown, and except sentiment flips again towards Greed, the trail of least resistance stays to the draw back.
