Bitcoin Bounces, But Whales Keep Selling: Trouble Ahead?

Key Insights:

• Whales and ETFs continue moving BTC to exchanges, showing persistent selling pressure despite price bounce.
• Institutional demand outpaces new supply, but short-term traders remain cautious near the $112K resistance.
• Weak spot demand signals the rally may fade unless BTC reclaims $112K with strong market participation.

Bitcoin touched the $108,000 support level earlier this week and has since bounced back, currently trading around $110,206. The support has been held multiple times in the past, making it an area closely watched by traders. Despite this bounce, BTC has not been able to move above the $112,000 mark, a level seen as important for shifting short-term momentum.

Price action remains within a downtrend, with lower highs and lower lows forming since the last peak in mid-October. Until Bitcoin reclaims $112,000 with strong buying activity from spot markets, the trend is expected to remain under pressure.

Exchange Activity Shows Ongoing Sell Pressure

Recent data from CryptoQuant shows steady BTC inflows to exchanges during October. Net inflows—often a sign of coins being prepared for sale—dominated for most of the month. Large spikes in exchange inflows were recorded on October 3, 15, and 27, each day seeing over 10,000 BTC moved onto trading platforms.

While there were minor outflows on a few days, these movements were not large enough to suggest accumulation. The continued inflows align with recent price declines from above $124,000 to the current range, suggesting whales and other large holders are still offloading positions. One observer noted that “long-term buyers are not yet stepping in decisively.”

Institutional Buying Surges as Miner Output Falls

Separate data from Bitwise shows a contrasting picture. Institutions, including ETFs and public companies, have purchased over 975,000 BTC so far this year. During the same period, miners have produced only 136,000 BTC. This widening gap between demand and new supply points to ongoing large-scale accumulation.

The spike in institutional buying comes after the April 2024 halving, which reduced daily BTC issuance. Compared to previous years, the current pace of institutional accumulation is the highest on record. The supply available on the open market continues to shrink, even as short-term holders appear to be selling.

Key Level to Watch Remains at $112,000

The $112,000 level continues to act as a barrier. Until it is reclaimed, the trend remains vulnerable to further downside. Failure to move higher could result in another test of the $108,000 support zone. If that breaks, price may head toward lower levels near $106,000.

While institutional demand remains strong in the background, short-term market signals show caution. As one analyst noted, “spot demand needs to pick up for this bounce to gain any real traction.” Traders continue to watch closely for any shift in momentum.