Bitcoin’s Delicate Balance: Navigating Thin Liquidity and Shifting Market Sentiment
As the cryptocurrency market waits with bated breath for a new wave of demand to prop up Bitcoin’s corporate base, the flagship cryptocurrency has found itself stuck in a narrow trading range. Between $110,000 and $116,000, Bitcoin is consolidating in a thin-liquidity air gap, leaving investors and analysts alike wondering what’s next for the digital asset.
Consolidation and Accumulation
Following a report by Glassnode on August 6th, Bitcoin’s price retreated to $113,000 after hitting a new all-time high above $123,000 in mid-July. This price movement left many younger buyers in the red and created an offer cluster with a cost base above $116,000. Historically, areas with low liquidity like this can transform into accumulation zones if buyers perceive the current price as a discount and start to enter the market.
The lower limit of this cluster has repeatedly supported rebounds until July 31, when Bitcoin broke deeper into the air gap. According to Glassnode’s report, the Unspent Profit Output (UPRO) snapshots from July 31 and August 4 were compared to measure dip buying. After a brief dip to around $112,000, investors acquired approximately 120,000 BTC, pushing spot prices back above $114,000. This move was driven by opportunistic demand, but the $110,000 to $116,000 range remains a key battleground.
New Resistance and Metrics
The rally has yet to reclaim the cost base of owners from one week and one month ago, with a decisive resistance level now at $116,900. A sustained break above this level would signal that bulls have regained control, while a failure would increase the risk of a deeper test of the previous all-time high area around $110,000. According to Glassnode, the price is currently in a “warm” but not overheated regime, remaining above the $106,000 threshold that has historically marked the boundary between short-term bullish and bearish phases in Bitcoin bull markets.
The supply of profits has decreased from 100% to 70% during the wear and tear, aligning with the center line of previous bull cycles. The proportion of short-term holders (STH) in profit has also decreased to 45%, indicating a balanced market with no clear dominance. This nuanced picture suggests that Bitcoin is navigating a critical juncture, with the potential for either a breakout or a breakdown.
ETF Flows and Leverage
On August 5, spot Bitcoin Exchange-Traded Funds (ETFs) in the US recorded an outflow of 1,500 BTC, the largest ETF sell pressure since April 2025. While these episodes have historically been short-lived, monitoring their persistence is crucial. In the derivatives market, perpetual financing rates have dropped below 0.1%, entering a neutral zone that can quickly turn speculative appetite and convictions upside down.
Taken together, Bitcoin appears to be stuck in the $110,000 to $116,000 corridor, with the offer accumulating and waiting for sufficient demand to recapture $116,900 and reaffirm the upward trend. As the market waits for its next catalyst, one thing is clear: the delicate balance between bulls and bears will be tested in the coming days and weeks.
