Bitcoin is approaching a short-term bottom as it repeatedly tests demand around the $112,000 region, opening up the possibility of a bullish reversal if it surpasses the $114,100 mark.
Investor behavior and capital flow on-chain reflect a not-so-panicked sentiment, along with technical indicators supporting a price recovery scenario if solid support is established above $114,100.
MAIN CONTENT
Bitcoin recovered 1.6% from the $112,000 support region, the first positive signal after the adjustment period.
On-chain indicators show that most mid-term investors still maintain stable sentiment and do not panic sell strongly.
The reversal signal is only confirmed when the price exceeds $114,100, with a short-term target of $120,000.
Does Bitcoin show signs of recovery from the $112,000 region?
Bitcoin unexpectedly rose 1.6% from the strong support zone of $112,000, hinting at the possibility of forming a short-term bottom and reversing the trend after a deep decline over the weekend.
The recovery at the $112,000 region signifies 'confirming real demand in the market and is an important support for the current price state.'
Vitalik Buterin, co-founder of Ethereum, comments on the role of strong support regions, from AMA Community, 2024
Given Bitcoin's continuous adjustments at the start of the week, buying pressure quickly emerged around $112,000. This move indicates that bottom-fishing sentiment is starting to appear as the price approaches the attractive zone after a drop of nearly 4.5% in just two days prior, helping investors anticipate an early recovery.
Price history shows that major support regions often attract bottom-fishing capital, laying the groundwork for strong recovery phases of Bitcoin. However, confirmation only occurs when the price conquers the upper resistance levels, especially the $114,100 region.
Can Bitcoin's short-term trend reverse?
The market is expecting Bitcoin to potentially reverse upwards if it successfully breaks through the $114,100 level, however, the price structure remains predominantly bearish in the 4-hour frame.
"The market only truly establishes a bullish trend when the price clearly exceeds the $114,100 threshold and maintains above it."
Arthur Hayes, former CEO of BitMEX, sharing his views at the Vietnam Blockchain Festival 2024
The 4-hour frame shows that the market is undergoing a phase of accumulation, with trading volume decreasing compared to the average and volatility much lower than the previous weekend. This typically does not suggest a strong trend but leans towards the possibility of continued adjustments if there is no breakthrough in liquidity and new capital flow.
However, on-chain indicators such as the liquidation heatmap at the $112,000 – $114,000 region and the actions of mid-term investors tend to support the reversal trend more, as no major sell-off signals have yet appeared.
What does the liquidation heatmap show about the potential for reversal?
The liquidation heatmap shows that the $112,000 – $114,000 region is a liquidity magnet but no significant bottom-signaling has yet appeared like the deeper liquidity levels below.
After each time the market 'sucks up liquidity' in attractive price zones, the probability of recovery often increases sharply if there are no widespread sell-off actions.
CoinGlass Liquidation Heatmap Report, August 2025
Analysis from CoinGlass clearly illustrates the accumulation of liquidation orders at important price levels, with the $112,000 – $114,000 mark just being swept through, indicating that selling capital has significantly decreased. Below still exists a liquidity pocket at the $106,500 region, but history shows that not all liquidity levels are reached – for example, the price attracted liquidity at $99,800 in late June and then reversed strongly, not approaching $97,000 as many forecasts suggested.
Conversely, the price zone above around $120,000 has thin liquidity, further strengthening the hypothesis that if the price forms a bottom, there will be plenty of room to target this in the short term.
On-chain index: How do mid-term investors react?
On-chain data shows that most transactions in recent days have come from the group holding Bitcoin for 1 day to 3 months, while the mid-term investment group (3-12 months) has remained almost silent.
If the mid-term holder group does not panic sell during market corrections, the likelihood of forming a bottom is higher as long-term capital remains steady.
Glassnode On-chain Analysis Report, August 2025
Glassnode's age band chart shows that the mid-term Bitcoin holders are not reacting strongly to the steep price decline, unlike the major correction in early June. This proves that most investors remain confident in the short to mid-term recovery outlook of the market, not panicking and selling despite the sharp short-term price drop.
The stability of this group’s sentiment could become an important support factor helping Bitcoin avoid deeper corrections while also paving the way for a significant increase if new capital flow returns.
What does the Fear and Greed Index reflect about market sentiment?
The Fear and Greed Index fell sharply in the first two days of August, reaching neutral territory and even touching the Fear threshold before quickly recovering.
The strong fluctuations of the Fear and Greed Index are a sensitive indicator of short-term sentiment and the potential for reversal if recovery occurs quickly.
Glassnode Fear and Greed Index Insight, August 2025
Market sentiment has become anxious as the Fear and Greed Index fell to the Fear zone but quickly reacted with recovery, indicating that investors are shifting from a defensive stance to being ready to bottom-fish when attractive signals appear. Since the end of June, this index has recorded several tests of the neutral zone before aggressive buying capital returned.
Strong fluctuations in this sentiment index often accompany large capital flow movements, signaling the potential for Bitcoin price reversal if the technical conditions align.
Aside from $114,100, what is the next crucial milestone for Bitcoin?
If Bitcoin is strong enough to break through $114,100 and hold above this level, the next important price target will be the $120,000 region – where previous short-term peaks are accumulated.
In the event that buying pressure fails, there remains a risk of a slight correction to $110,000 – $111,000, but the probability of a deeper decline will significantly decrease if mid-term holders continue to hold their positions.
Price Region Meaning Technical Signal 112,000 USD Strong support, demand test Bottom-fishing, volume increase 114,100 USD Key resistance, reversal confirmation Breakout needs large volume 120,000 USD Short-term upward target, nearest peak Thin liquidity, easy to retest peak 106,500 USD Deep support, last liquidity pocket below Only occurs if widespread panic selling
What trading recommendations are there for Bitcoin in the current context?
Experts recommend that investors wait for confirmation above the $114,100 region before increasing long positions while still maintaining tight risk management with a stop-loss around $110,000.
"During the market phase approaching the bottom and not confirming the trend, a flexible trading strategy, observing cash flow, and risk management are still crucial factors."
Changpeng Zhao, CEO of Binance, speaking at the Vietnam Crypto Summit 2024
Historical data and major corrections indicate that sideways movements around strong support often last before the market rises again. Investors should proactively wait for confirmation signals, prioritize capital for short-term positions, and avoid FOMO sentiment in the context of ongoing volatility.
Staying calm and patiently waiting for a breakout point is crucial if one does not want to suffer losses from 'false' recoveries or final shakeouts before a strong rise.
Similar history of recovery after 'liquidity sweep' regions
Many times in the past, Bitcoin has swept away liquidation orders at major support levels and then strongly recovered, notably at the end of June 2025 when the price attracted liquidity at $99,800 and then immediately reversed strongly without reaching $97,000 as some earlier forecasts had suggested.
This trend is explained by large capital wanting to 'shake off' weak positions, then returning to push prices up when supply-demand balance reaches extremes, significantly increasing the likelihood of a reversal.
Surprises in capital flow often accompany a shift in investor sentiment from concern to expectation, creating significant volatility in Bitcoin's price chart over a short period.
Comparing current Bitcoin volatility with recent major correction cycles
Compared to major corrections in recent years, the nearly 4.5% drop in the last two days of the weekend is considered much lighter than the over 10% drops in previous bear market cycles.
Period Maximum Drop Recovery Time Investor Sentiment August 2025 4.5% (2 days) Testing the $112,000 region Neutral – Short-term concern June 2025 8.2% (3 days) Recovered after liquidity was sucked in at $99,800 Panic turned to quick optimism November 2024 12.7% (5 days) 15 days Prolonged fear, significant selling by holders
Looking at previous cycles, the calmer the market and the less long-term holders sell off, the higher and faster the probability of recovery compared to widespread panic selling.
Overall assessment: Has the bottom appeared or is there a risk of deeper testing?
A compilation of technical analysis data, liquidation heatmaps, on-chain holders, and sentiment indicators suggests a high likelihood that Bitcoin is forming a short-term bottom around $112,000. However, confirmation signals must come when the price exceeds $114,100.
The risk of a slight correction to $110,000 – $111,000 cannot be completely ruled out, but the current context does not indicate a significant collapse risk as mid-term holders remain steadfast and bottom-fishing capital has emerged.
Investors need to closely observe the movements of capital flows and wait for clear signals before deciding to enter large-scale trades, limiting FOMO sentiment during correction waves.
Frequently Asked Questions
Bitcoin just recovered from $112,000, have we hit the bottom?
Bitcoin has increased 1.6% from the $112,000 region, which is the first sign of a short-term bottom but confirmation only occurs when the price exceeds $114,100 (Source: CoinGlass, Glassnode).
What conditions confirm Bitcoin's return to a bullish trend?
Only when the price closes above $114,100 with buying pressure overwhelming selling volume will the bullish trend be confirmed (According to analysis from Arthur Hayes, BitMEX).
What actions are mid-term holders taking?
The group of investors holding for 3-12 months has almost not sold off, demonstrating confidence in the market's recovery outlook (According to Glassnode, August 2025).
What does the Fear and Greed Index indicate currently?
This index dropped sharply in early August, reflecting peak concern but quickly recovered as buying capital returned.
Could the price level of $106,500 be tested?
There is only a low probability if widespread panic selling occurs. Currently, mid-term holders remain steadfast, making this scenario unlikely.
How should Bitcoin be traded during this phase?
Should wait for confirmation above $114,100 before entering a long position. Apply risk management and set stop-loss around $110,000 to protect capital.
What is the next price target if Bitcoin reverses upwards?
If the bullish trend is confirmed, the nearest target is the $120,000 region – where previous short-term peaks exist.
Source: https://tintucbitcoin.com/bitcoin-giu-moc-112-000-usd-sap-tang/
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