Bitcoin Weakens as Demand Wave Exhausts, Traders Eye $85K Retest

Bitcoin is showing signs of a weaker market structure, with demand that supported prices earlier this year fading and investors moving into defensive positions. CryptoQuant reports that the cycle’s core demand wave has largely passed, citing slowing ETF accumulation, evaporating Treasury-company purchases, and Strategy buys dropping to their lowest levels of the year.

While this doesn’t indicate an imminent crash, CryptoQuant notes that upside is increasingly limited. Any rallies are likely to stall below the 365-day moving average until a fresh wave of demand emerges.

Polymarket traders are reflecting this caution, assigning the highest probability to a retest of $85,000 and giving minimal weight to upside scenarios.

Market Signals Turn Cautious
Glassnode adds that short-term holders are realizing losses at the fastest rate since the FTX collapse, ETF flows remain negative, and derivatives markets have shifted into full risk-off mode, with options traders favoring puts and implied volatility rising.

The Active Investor cost basis near $88,600 represents the market’s next critical test. A sustained move below this level would put recent active investors into losses for the first time this cycle, signaling that bearish momentum may be taking control. The next key support sits at the True Market Mean around $82,000—a level that could usher in a bear market structure similar to 2022 and 2023 if breached.

The coming weeks will be crucial in determining whether buyers can regain control or whether the downturn deepens.

Market Snapshot

• BTC: Trading near $92,000 after briefly dipping under $90,000 earlier in the week.
• ETH: Around $3,038, modestly lower, mirroring Bitcoin’s cautious tone.
• Gold: Near $4,067, after hitting an intraday high of $4,132 amid rising risk aversion.
• Nikkei 225: Asia-Pacific markets gained Thursday, with Nvidia’s strong earnings lifting chip stocks and pushing the Nikkei 225 up 3.7%.

Crypto Highlights

• Samourai Wallet Co-Founder Bill Hill sentenced to four years for unlicensed money transmitting (CoinDesk).
• New Hampshire unveils $100 million Bitcoin-collateralized municipal bond (Decrypt).
• Bullish swings to profit in Q3 after adding options and U.S. spot trading (CoinDesk).