The sentiment among Bitcoin investors has significantly deteriorated, reaching its lowest point since June 22, 2022. This shift raises concerns and may signal a future rebound.
Decline in Trader Sentiment
Pessimism among Bitcoin traders has risen following a price drop below $113,000. Retail sentiment has hit its lowest level since June 22. During that time, fear intensified due to U.S. airstrikes in Israel, and Bitcoin quickly rebounded from its dip. Similar reactions were observed on July 9 and August 18 when sharp corrections punished optimistic sentiment.
Technical Signals Indicate Downside Risks
The 4-hour Bitcoin chart highlights a double-top pattern around $122,000. The price faced rejection twice at this level before breaking below the ascending trendline. This decline also pushed Bitcoin under the 200 EMA, reinforcing bearish momentum. Current trading sits near $113,381 with mounting selling pressure. Based on the double-top projection, the next support lies between $110,500 and $110,000.
Demand Growth Weakens Due to ETF Flow Slowdown
CryptoQuant analyst Julio Moreno stated that Bitcoin’s recent pause is directly linked to slowing demand growth. Data shows that apparent demand, measured as a 30-day sum, has weakened. "It's the demand, stupid. Slowing overall demand growth for Bitcoin, including ETF and strategy purchases, is behind the current price pause/correction," Moreno remarked. As ETF inflows and corporate strategy purchases have tapered off in recent weeks, cooling of the market may be related to this slowdown.
The current market situation for Bitcoin demonstrates a decline in sentiment and a slowdown in demand. Trader behavior and various technical signals may suggest potential rebounds; however, new incoming flows are necessary for this to materialize.
