Bitcoin (BTC) Faces Profit-Taking Pressure as It Retraces from New ATH

Bitcoin's recent ascent to a record high of $111.8k has encountered significant headwinds, as seasoned holders begin to capitalize on their gains. This trend is generating a pullback in the cryptocurrency's price, now hovering around $103.2k, according to Glassnode.

Profit-Taking by Long-Term Holders

Long-term investors, especially those holding Bitcoin for over a year, are driving the current selling pressure. This cohort realized profits up to $1.47 billion per day, marking the fifth significant profit-taking wave in the current cycle. This activity underscores a potential shift from accumulation to distribution, particularly as Bitcoin tests critical support levels at $103.7k and $95.6k.

Impact of Accumulation and Distribution Zones

The Cumulative Volume Delta (CBD) Heatmap reveals that earlier accumulation zones have now transitioned into distribution areas. Notably, regions between $25k–31k and $60k–73k, previously strong support, have now turned into selling zones. This change reflects a broader sentiment shift as previous buyers take profits, challenging the bulls to maintain momentum.

On-Chain Analysis and Market Sentiment

On-chain pricing models, such as the Spent Supply Distribution (SSD) Quantiles, help identify potential support and resistance levels. The 0.95 quantile, representing the top 5% of spent supply, is currently at $103.7k, while the 0.85 quantile at $95.6k provides secondary support. Resistance is seen at $114.8k, which could cap further upward movements unless strong buyer interest re-emerges.

Current Market Dynamics

The market's current dynamics point to a critical juncture, with the potential for either a mid-cycle consolidation or the beginning of a broader top formation. Short-term holder cost basis, now at $97.1k, alongside standard deviation bands, frames the market's immediate sentiment. A breach above $114.8k or below $83.2k could indicate a significant directional shift.

Overall, Bitcoin's journey to its latest peak has been met with increased resistance from long-term holders opting to realize profits. The market's resilience will be tested in the coming weeks, determining whether this is a temporary pause or a more substantial trend reversal.