Bitcoin’s sharp four-day decline to $104,000 last week has been characterized by analysts as a necessary market reset, rather than a signal of cycle failure.
Analysts see healthy correction
According to TradingView data, bitcoin fell from $115,000 to $104,000—a level not seen since June—prompting what Glassnode described as a “defensive rotation” among investors.
The correction is believed to have flushed out excess leverage in the market, with open interest dropping by about 30%. Glassnode noted in its latest report:
“This combination of signals points to a market shifting into protection mode, with traders prioritizing capital preservation over directional bets.”
Glassnode also found that the share of supply held by short-term holders is rising, suggesting that “speculative capital is becoming more dominant.”
Shifting dynamics among holders
Jan3 CEO Samson Mow addressed the current price range, stating:
“This $0.1M to $0.2M range is a hard time for those with weak conviction to HODL Bitcoin. They’re uncertain because the ‘cycle’ didn’t happen like before, and also because other assets like gold are rallying.”
Mow predicted bitcoin is likely to “add a zero soon enough,” warning that investors with weak hands could be shaken out during this volatile period.
Institutional absorption and ETF outflows
Glassnode analyst Chris Beamish highlighted that long-term holders continue to sell, with digital asset treasuries and bitcoin ETFs absorbing large amounts of supply.
However, upward momentum may remain limited until these long-term holders reduce their selling.
ETF data showed $40 million in outflows on Monday, marking the fourth straight day of withdrawals amid political uncertainty.
