Bitcoin is down 8% from ATH, and market sentiment shifts from greed to fear as short-term investors sell below their cost basis, raising concerns about the risk of deeper adjustments.
Recent developments show that short-term investors are continuously realizing losses, buyer liquidity is depleted, placing Bitcoin at a decisive moment and warning of continued downward pressure if new buying power does not emerge.
MAIN CONTENT
Bitcoin is down 8% from ATH, and short-term investors selling at a loss indicate increasing adjustment pressure.
The buy wall has been broken, and the short-term SOPR has dropped below 1 for the first time in over two weeks, reflecting capitulation sentiment.
Liquidity is fragile; without new buying money, Bitcoin's price could continue to decline below 110,000 USD.
What is causing Bitcoin to face adjustment pressure?
Bitcoin is down 8% from ATH, and market sentiment quickly shifts from greed to fear as short-term investors sell at a loss, creating concerns about a stronger adjustment trend.
"On-chain signals indicate that short-term investors are selling at real losses, increasing pressure on the downside."
Glassnode, Cryptocurrency market report, 2025
Actual data shows that the increase to 117,000 USD on August 16 was rejected, leading to three consecutive net withdrawals of Bitcoin, with the price plummeting to 112,000 USD. Weak buying, thin demand, pushed the STH SOPR below 1—the deepest loss in over a month, signaling that many new investors have capitulated.
When buying power is insufficient to absorb the selling of short-term investors, the market often witnesses deeper declines, especially when new money does not appear to support prices.
What does the decreasing short-term SOPR mean for Bitcoin?
Short-term SOPR (STH SOPR) falling below 1 reflects that swing traders are closing positions at prices lower than their cost basis, increasing selling pressure and signaling short-term negativity for Bitcoin.
"A decrease in SOPR indicates that realized losses are increasing, raising concerns about the likelihood of a prolonged adjustment or accumulation."
CryptoQuant, market analysis on August 16, 2025
A SOPR below 1 is usually observed in declining market areas, confirming that short-term investors no longer have confidence to hold their positions. History shows that whenever SOPR decreases and demand is not timely replenished, Bitcoin's price is often at risk of further depreciation. Conversely, if new buying money appears, the market can recover like the two-week increase after the early August correction.
Specifically, when BTC dropped from the 117,000 USD range without being able to convert that into support, most traders had to sell at a loss to minimize damage, thereby thinning the buy wall. If buying power does not return, the market may risk deep support breaches.
What do the buy wall and decreasing liquidity signal?
The lack of reinforcement for the buy wall continues to thin the bid-side liquidity, signaling the risk of further deterioration if new demand from large investor groups does not emerge.
"Unless there is a large buying move from whales or new capital inflows, Bitcoin's bounce-backs may be limited due to excessively weak liquidity."
Hyblock Capital, Orderbook report, August 2025
Comparing fundamentally to early August, when Bitcoin dropped 6% from resistance at 118,000 USD but immediately saw buying demand, leading to a recovery to around 124,000 USD. However, currently, buying momentum is weak, with bids being quite thin at a ratio of 0.14, while slippage has increased to 9.4. The lack of robust demand makes every effort to recover prices difficult.
The retail investor cohort is leaning towards buying with a long ratio of up to 61–62%, but this very 'imbalance' could cause the market to explode into a short squeeze or 'bridge break' at any moment if sharks exploit the poor liquidity.
Is the short-term recovery potential of Bitcoin optimistic?
Given the current context, a strong bounce similar to early August (6% increase) is very unlikely because the order book is skewed unfavorably for buyers, short-term investors are continuously realizing losses, and liquidity is thin.
"The market may need a sudden influx of large capital to maintain a solid recovery momentum."
Cryptocurrency market analysis report, CoinMarketCap, 2025
Any recovery attempts, if they occur, will need to rely on fresh buy flow, or the return of institutional fund flows. If 'demand' continues to be weak and retail investors hold too large long positions, Bitcoin's price is very likely to fall below 110,000 USD.
The phenomenon of evenly split long/short positions is particularly dangerous in illiquid markets, often resulting in 'false breakout' moves or pushing prices down further to test new support bottoms.
Why are short-term investors prone to capitulation during corrective waves?
Short-term investors (STH) are often sensitive to price movements, easily influenced by sentiment leading to panic selling during strong market corrections, especially in a weak liquidity environment.
"Capitulation sentiment flourishes as many new traders lack sufficient experience in risk management during large downward waves."
CryptoQuant's analysis of market behavior, 2025
Whenever the price is rejected at significant resistance levels and demand is weak, short-term investors will prioritize capital preservation by selling even at a loss. This increases supply pressure while there is no new demand, making the market more susceptible to deeper corrections, creating a widespread cycle of pessimistic sentiment.
Through previous cycles, capitulation phases often pave the way for the market to accumulate again or prepare for a new growth spurt if strong supporting factors from macro or new capital flows exist.
Comparison table of market movements between the two most recent Bitcoin correction phases
Criteria Early August 2025 Mid August 2025 Price drop 6% from 118,000 USD 8% from ATH (117,000 USD to 112,000 USD) Short-term SOPR Touched 0.99 Fell below 1 (largest loss in 1 month) Buying liquidity (Bid-side liquidity) Quickly reinforced, new money appeared Thin and continued to withdraw, no new money Result Strong recovery to 124,000 USD Downward pressure, risk of falling below 110,000 USD
Frequently asked questions
What does Bitcoin's 8% drop from ATH reflect?
The sharp decline in Bitcoin, combined with fear sentiment and widespread loss realization from short-term investors, reflects significant adjustment pressure and ongoing risks if new buying power does not emerge. Validated data from Glassnode.
What does the significant decrease in short-term SOPR mean?
SOPR below 1 indicates that many short-term investors are selling below their cost basis, creating a wave of increased selling pressure, typically accompanied by risks of further declines.
How does the selling at a loss by the STH group affect the market?
The selling at a loss by short-term investors makes liquidity thin, increasing the risk of breaking support levels and pushing prices down easily.
How to know when the market will recover?
The market will only truly recover if strong new buying money from large investors or institutions emerges, reinforcing buying liquidity.
What percentage of retail investors currently holds a buying position?
Currently, the long position ratio from retail investors is about 61–62%, marking an optimistic sentiment but also increasing the risk of strong volatility.
Is Bitcoin at risk of falling below 110,000 USD?
If liquidity remains weak and there is no new buying money, Bitcoin's price could very well head towards below 110,000 USD, according to CoinMarketCap's analysis.
Which indicators confirm that the market is forming a temporary bottom?
When the short-term SOPR recovers above 1, buying liquidity increases; this is a signal for the potential accumulation or short-term price recovery.
Source: https://tintucbitcoin.com/bitcoin-ve-112k-usd-thi-truong-lo-lang/
Thank you for reading this article!
Please Like, Comment, and Follow TinTucBitcoin to stay updated on the latest news in the cryptocurrency market and not miss any important information!
