Bitcoin Eyes Recovery as Selling Pressure Fades

Key Moments

Macro Boost Supports Bitcoin Rebound

Bitcoin (BTC) has begun to recover after a prolonged period of range-bound trading near its recent lows, with a new report from Glassnode on Wednesday suggesting that these moves may represent the early formation of a price floor. The firm attributes the improving tone in part to macroeconomic data that has bolstered investor sentiment.

Following the latest US Consumer Price Index (CPI) inflation release on Tuesday, Bitcoin outpaced both US and European equity benchmarks, staging a strong rebound. According to Glassnode, this performance indicates that selling momentum is waning as market participants increasingly look for favorable macro headlines to justify renewed risk-taking.

“That sensitivity is the tell. A market this eager to rally on one inflation print is a market where sellers are spent and buyers are waiting for a reason,” Glassnode wrote.

That observation preceded Wednesday’s Producer Price Index (PPI) report, which showed easing wholesale inflation and further supported the constructive narrative for Bitcoin, described in the report as the leading cryptocurrency.

Onchain Metrics Signal Late-Stage Bear Market Dynamics

Glassnode pointed out that Bitcoin is still trading above the average onchain cost basis for all holders, while remaining below the short-term holder (STH) cost basis, which is located near $69,000. This positioning illustrates that, on average, investors remain in profit, but more recent buyers are still under water.

The report also noted that long-term holders have largely stopped realizing gains, with recent outflows more frequently associated with realized losses. Glassnode interprets this pattern as consistent with a mature phase of a bearish cycle.

At the same time, the firm highlighted that buyers have absorbed a considerable portion of the supply that came to market during June’s decline. Its Accumulation Trend Score signaled widespread accumulation across both smaller and larger wallet groups while Bitcoin traded close to its recent lows. As prices have steadied, this accumulation trend has eased back.

ETF Flows Stabilize as Institutional Selling Slows

Institutional activity in the US spot Bitcoin ETF complex has also shown tentative signs of improvement. Glassnode reported that redemptions from these products have dropped sharply compared with the heavy outflows recorded in June, indicating that the wave of selling is beginning to level off.

On Tuesday, Bitcoin investment products recorded $181 million in net inflows, partially counterbalancing the $424 million in net outflows registered the day before. While this shift marks a modest recovery in flows, Glassnode emphasized that the broader deleveraging has not yet been matched by robust fresh demand, implying that institutional investors remain cautious.

“Until inflows return and hold, this remains a market where institutions have stopped fleeing but not started buying,” Glassnode wrote.

Derivatives Show Reduced Bearish Positioning

In the derivatives space, positioning has gradually turned less negative. Glassnode noted that the options put-to-call ratio has dropped to its lowest reading of the year, signaling diminished appetite for downside protection among options traders.

Perpetual futures markets are sending a similar, albeit more moderate, signal. Funding rates have stayed marginally positive, which suggests that long positions are present but have not yet reached levels that would be considered crowded.

Even so, Glassnode warned that the pullback in bearish bets should not be confused with strong conviction buying in the underlying asset.

“What the unwind has not produced is actual buying. Futures and options traders repositioning is not the same as money entering the spot market, and that absence is the clearest caveat on the whole recovery,” the report stated.

Market Snapshot

As of the time of writing referenced in the report, Bitcoin is changing hands at $64,660, down 0.4% over the last 24 hours.

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