Bitcoin traders, watch out! 534K holders to break even at THIS level

Key Takeaways

Bitcoin faces a $116k battleground with liquidity stacking, STHs taking profits, and $107k support at risk, signaling a make-or-break phase ahead of the FOMC.

Bitcoin [BTC] is approaching a significant supply wall at $116,963. At this level, approximately 534k BTC, or 2.68% of the circulating supply, sat at risk of breaking even.

In fact, this zone has “historically” acted as a contested resistance level, attracting both profit-taking and distribution.

Case in point: Following BTC’s $123k ATH in the early-July cycle, the price consolidated within the $115k–$120k range for over two weeks, ultimately leading to a 6% pullback as Realized Profits surged to a post-election high.

Source: Glassnode

In short, this level represents a critical inflection point for Bitcoin.

On-chain backs this.

STH NUPL dipped to -0.07 in late August when BTC couldn’t hold $116k resistance and dropped to $108k, marking a classic capitulation phase as the bid wall couldn’t absorb selling pressure.

Will history repeat?

BTC has bounced 8% off the $107k low, locking in a solid bid wall. That means STHs are now sitting on 8% unrealized gains from the dip, pointing to the potential for another distribution cycle.

Bitcoin liquidity stacks near resistance

It’s now up to Bitcoin bulls to carve a divergence from previous cycles. And the stakes couldn’t be higher.

After failing to hold $116k, BTC printed two lower lows in the early Q3 cycle. The first at $112k, the second at $107k.

That keeps the door open for a deeper correction if support gives way.

Notably, BTC has rolled over after its 8% weekly bounce, with two straight red days showing weak hands breaking even. There’s also a $40 million long liquidity cluster around $114k, acting as a potential friction zone.

Source: TradingView (BTC/USDT)

In short, liquidity is stacking around Bitcoin resistance. 

Combine that with weak hands exiting, and it sets up a potential mid-July style flush. Now it’s up to the bulls: Either trap late bears here or risk a cascade of liquidations.

BTC Order Book hints at short-term support

Bitcoin’s Order Book depth is showing some notable shifts.

At press time, the BTC/USDT Order Book showed $32 million in buy orders, 2% below the current price and $22 million in sell orders, 2% above.

This means there’s more buying support below than selling pressure above.

In simple terms, traders are more inclined to buy on dips than sell on rallies.

Meanwhile, institutional flows into BTC were picking up, with nearly $2 billion pouring into ETFs this week alone.

Source: Farside Investors

Notably, this reinforces the divergence highlighted by AMBCrypto.

Retail is still playing it safe, while smart money and institutions are stacking positions aggressively. At the same time, Bitcoin’s STH NUPL was 0.3 down from the previous day, showing weak hands are shaking out.

However, as long as bid support keeps building underneath, Bitcoin looks set to smash through the $116k supply wall.

Once that cracks, FOMO could push a quick retest of $120k in the near term.