The recent Bitcoin rally faces notable risks due to significant whale selling activity combined with weak retail support, warning of a potential market correction.
Key points from current on-chain analysis and market reports include:
Since late July 2025, Bitcoin whales have moved $4 to $5 billion worth of BTC to exchanges like Binance, signaling preparation for selling large coin positions. This pattern is typical of distribution phases, where whales offload holdings onto the market.
Increased whale inflows to exchanges tend to weaken bullish momentum by adding selling pressure. Despite some retail buying activity picking up, the sustained large-scale whale selling overshadows it and raises the risk of a deeper pullback.
Retail traders, while more active recently, typically represent "late-stage buying." Their accumulation so far has not brought strong bullish follow-through, suggesting exhaustion and a fragile demand base supporting current prices.
Some analysts argue that while whales are unloading coins, others appear to be quietly accumulating off-exchange and moving coins to cold storage, reflecting a complex market dynamic. However, the dominant trend in recent weeks is net whale selling to exchanges.
Price-wise, Bitcoin is struggling with resistance around $116,000 to $117,000, which corresponds to the average purchase price of many short-term holders and serves as a key technical level. Failure to break and hold above this zone increases the odds of a correction testing lower support levels around $110,000 or even near $103,000.
Weakening retail investor confidence is evident in slowed profit-taking but reluctance to add fresh exposure at current levels, compounding the risk from whale sell-offs.
In summary, the current Bitcoin price rally faces a precarious situation where heavy whale selling to exchanges threatens supply-demand balance, while retail investors are hesitant, leading to a fragile market structure vulnerable to corrections. While accumulation by some smart money persists quietly, the dominant whale-to-exchange outflows indicate possible near-term price weakness unless buying interest strengthens.
Traders and investors should watch whale inflow metrics, exchange deposit flows, and retail buying behavior closely, especially around key price levels near $116K and $110K, as these will be critical in determining whether the rally can resume or if a sharper decline is imminent.