The futures market sentiment index for Bitcoin has dropped to 36%, reflecting a clear downward trend as retail investors sell off strongly, and the likelihood of price testing the 112,000 USD level is rising.
Bitcoin's continued sharp decline is causing both the futures and spot markets to carry bearish sentiment, with many technical indicators also supporting a short-term downward trend, creating greater risk for FOMO investors.
MAIN CONTENT
The Bitcoin futures sentiment index has fallen into the declining zone, signaling the risk of increased selling pressure.
Retail investors dominate the market, increasing short positions, and the Long Short Ratio continues to decline.
Technical indicators such as RSI and Stochastic RSI indicate that the downward momentum may continue, with the 112,000 USD support level being monitored.
Is Bitcoin facing a short-term downtrend?
Bitcoin continuously declined for five sessions with a decrease of 3.24% for the week, recording a short-term bottom at 114,442 USD before trading around 115,055 USD.
The latest report from CryptoQuant shows that this decline is causing market sentiment to become bearish, adding more selling pressure in the short term.
CryptoQuant market analysis report, August 2025
Both the futures and spot markets are simultaneously carrying negative sentiment, making investors vulnerable to a sell-off wave, increasing the risk of a deep price decline in the coming sessions. Risk management becomes a crucial factor.
What does the sharp drop in the Bitcoin futures sentiment index mean?
According to expert Axel Adler, the sentiment index in the Bitcoin futures market has dropped to 36%, much lower than the neutral threshold (45%), signaling a dominant downward trend.
A sentiment index falling deep below 45% often means that most traders are becoming more cautious, prioritizing capital preservation over opening new long positions.
Axel Adler, an analyst at CryptoQuant, posted in August 2025
History shows that significant changes in the futures sentiment index often forecast Bitcoin price volatility. Specifically, in mid-August 2025, when the index surged to 70%, Bitcoin price broke through to 123,000 USD. Conversely, a drop to 36% led to strong sell-offs during rebounds, maintaining downward pressure; Adler forecasts a risk of 112,000 USD is justified.
What role do retail investors play in the current trend?
Analysis from AMBCrypto shows that retail investors are dominating the Bitcoin futures market and are carrying extremely bearish sentiment.
The Futures Average Order Size data indicates that small orders dominate, reflecting the predominant role of individual investors compared to whales at this time.
CryptoQuant report, August 2025
The Long Short Ratio (from Coinglass) has dropped to 0.8765, meaning that short positions account for 53%, surpassing 46.7% of long positions. According to market theory, when the number of short positions is overwhelming, most traders are betting that the price will continue to decline sharply in the short term.
How has the sell-off activity in the spot market increased?
In addition to short positions in futures, retail investors are also selling heavily in the spot market, as evidenced by a record drop in the Taker buy/sell ratio over five sessions, reaching a two-week low.
This indicates a dominant selling sentiment on exchanges, signaling that Bitcoin supply is rising rapidly compared to buying demand.
CryptoQuant data source, August 2025
As a result, the amount of scarce Bitcoin in the market has bottomed at 41,000 BTC compared to last month's peak of 53,000 BTC. This surplus supply always serves as a warning for subsequent price drops, unless a strong growth stimulus (demand shock) appears to adequately balance supply and demand.
What do technical indicators forecast for the next developments?
The Stochastic RSI indicator of Bitcoin is currently down to 10 points, deep in oversold territory, while the RSI is at 44 points, reflecting that selling pressure still dominates in the short term.
According to technical analysis experience, when both momentum indicators fall deep below the neutral threshold, the probability of a prolonged downward trend increases significantly. If no new buying cash flow emerges, Bitcoin could very well test the 112,000 USD support as forecasted by Adler.
When market sentiment is extremely bearish, any short squeeze could quickly reverse, recovering prices to the 117,000 USD range.
Analysis from TradingView, August 2025
Traders should manage risk closely, avoiding getting caught up in technical recovery phases (dead cat bounces) if selling pressure shows no signs of sustainable weakening.
What risk factors should Bitcoin investors pay attention to today?
Bearish sentiment spreads as both the futures and spot markets show signs of sell-offs from retail investors. This is accompanied by increased liquidity on the sell side, a deep drop in sentiment index, and momentum indicators confirming a downward trend.
In some past cases, when the number of short positions is excessively large, it can lead to a short squeeze in the short term. However, this possibility still depends on large cash flow volatility and clear recovery signals from technical indicators, along with improved market confidence.
Comparing the impact of psychological, technical, and cash flow factors on the current Bitcoin price
Factors affecting Bitcoin price Data evidence Futures sentiment index drops deeply, signaling the risk of sharp price decline Sentiment Index 36%, CryptoQuant August 2025 Retail investor cash flow Sell-off, increasing downward pressure Long Short Ratio below 1, short positions 53%, Coinglass Technical indicators RSI, Stochastic RSI both fall into oversold territory Stochastic RSI 10, RSI 44, TradingView Spot market supply Scarcity decreases, BTC supply is more abundant Scarcity amount decreased to 41,000 BTC, CryptoQuant
Frequently asked questions about the current Bitcoin market trend
What is the Futures sentiment index of the Bitcoin market?
This is a measure of traders' optimism or pessimism in the futures market. The lower the index, the more susceptible the market is to downward impacts.
Why do short positions dominate the Bitcoin Futures market?
Dominance of short positions means many investors forecast that Bitcoin price will continue to decrease and prioritize short selling, reflecting negative market sentiment.
How does Bitcoin scarcity affect the price?
When scarcity decreases, BTC supply in the market increases; if there is no corresponding demand, it will push the price down further.
When can a short squeeze occur in the market?
When too many investors take short positions and Bitcoin price rebounds strongly, buying pressure may emerge to squeeze shorts, pushing prices up rapidly.
What do low RSI and Stochastic RSI indicate?
Both oversold indicators show that selling pressure is currently very strong, but there is also a potential risk of reversal when negative sentiment reaches its peak.
What price range is currently the short-term support for Bitcoin?
It is forecasted that the 112,000 USD range is considered the primary short-term support if the downward trend continues to dominate.
What should investors do in the current market context?
Maintain strict risk management discipline, avoid emotional trading, and closely follow technical signals before making buying or selling decisions, prioritizing capital preservation before profit.
Source: https://tintucbitcoin.com/futures-bitcoin-dao-chieu-btc-ve-112k/
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