If Bitcoin loses the critical support at $107,000, it may drop to $95,000. Currently, spot demand is neutral, and perpetual contracts are leaning bearish.
Written by: CryptoVizArt, UkuriaOC, Glassnode
Compiled by: AididiaoJP, Foresight News
Bitcoin is trading close to $111,000, testing the critical support range of $107,000–$108,900. A rebound to $113,600 may face continued selling pressure, while deeper potential targets look towards $93,000–$95,000. Current losses remain shallow, spot demand is neutral, and perpetual contracts are leaning bearish but displaying mild performance.
Summary
Bitcoin has pulled back to $111,000, with support anchored at the cost basis cluster of $93,000–$110,000. If it drops below $107,000–$108,900, it may open up downward space, targeting $93,000–$95,000.
Short-term holders remain under pressure, so any rebound to $113,600 may encounter resistance as they sell during the rally.
Unrealized and realized losses remain shallow, far from the extremes observed in past bear markets, indicating that the sell-off to date has been limited.
Spot demand has been neutralized, while perpetual futures are leaning bearish, with funding rates showing a fragile neutral state.
Fill the Gap
The market has entered the second week of retracement from the historical high of $124,000, raising the question: is this merely a brief pause or the start of a deeper pullback? To answer this, we turn to price models, starting with the cost basis distribution (CBD) heatmap.
The CBD heatmap provides a visualization of the supply concentration at different acquisition prices, highlighting significant parts of the token's last handovers. Each color band reflects areas of cost basis density that often act as natural support or resistance zones.
Currently, Bitcoin is trading close to $111,000, hovering just above the lower edge of the 'price gap'. The latest pullback allows for a reallocation of supply at a discount, gradually filling the gap. Notably, since December 2024, a thick supply cluster has formed between $93,000 and $110,000, gradually becoming a potential bottom.
This accumulation helps explain the ongoing resilience above $110,000, indicating that further correction requires either significant short-term selling pressure or a longer absence of demand sufficient to force these investors to capitulate and sell.
Testing New Buyers' Patience
To better gauge the frustration levels in the market, we turn to the cost basis of recent investors. This indicator captures the average acquisition price of holders who entered the market in the past 1 to 6 months as a psychological benchmark. When the market trades below these levels, it typically indicates that new holders are falling into unrealized losses, a condition that might trigger selling pressure.
Currently, Bitcoin is trading below the cost basis of 1-month ($115,600) and 3-month ($113,600) holders, putting these investors under pressure. Thus, any relieving rebound may encounter resistance as short-term holders seek to exit at breakeven.
More critically, the 6-month cost basis is around $107,000. Continued drops below this level may trigger fear, accelerating downward momentum and pointing towards the lower edge of the support supply cluster highlighted in the CBD heatmap.
Medium-term Risk
If the current weakness persists, with prices continuing to trade below the short-term holders' cost basis near $108,900, history suggests caution is warranted. In past cycles, such breaches have typically heralded the beginning of months of bearish phases as new investors sell off amidst increasing unrealized losses.
A risk framed by four years of statistics shows that previous bearish pullbacks typically find their ultimate lows around one standard deviation below the short-term holders' cost basis. For the current cycle, this lower bound is estimated to be around $95,100. Therefore, if Bitcoin fails to regain a foothold above the $107,000–$108,900 threshold, the mid-term range forming a potential bottom may lie in the $93,000–$95,000 area, consistent with the dense support cluster emphasized earlier in the CBD heatmap.
Past Cyclical Bear Markets
To accurately assess the current level of pain, we can compare today's market structure with previous cyclical extremes. Historically, bear markets have been characterized by severe pullbacks that either define a mid-term reset or are comprehensive sell-off events.
So far, the recent drop to $110,000 represents a pullback of about 11.4% from the historical high of $124,000. Compared to previous medium-term bear markets (typically over 25%) or deep cyclical lows (losses greater than 75%), the current drop is significantly milder. In this context, the intensity of the current correction remains relatively shallow and has not yet seen the kind of pressure observed at historical extremes.
Measuring Pain through Unrealized Losses
Another way to measure the current correction is through relative unrealized losses, which measure the market's total losses relative to its market capitalization. This indicator highlights the scale of stress investors are experiencing compared to previous cycles.
Since November 2023, relative unrealized losses have largely remained below -0.5 standard deviations, around 5%, never approaching the depths observed during the long-term bear markets of 2018–2020 or 2022–2023.
Currently, Bitcoin is trading close to $111,000, and this indicator is only at 0.5%, far below the loss levels usually associated with deep bear market phases (greater than 30%). This perspective reinforces earlier conclusions: despite the recent pullback causing frustration among short-term holders, the extent of unrealized pain across the broader market remains far from historical extremes.
Realized Sell Pressure
While unrealized losses provide a perspective on investor stress, it is equally important to observe how much of these paper losses are actually realized on-chain. The Spent Output Profit Ratio (SOPR) provides this insight by measuring the ratio of the price at which tokens are spent to their cost basis. Values above 1 indicate profits are being realized, while values below 1 suggest tokens are being sold at a loss, signaling a potential sell-off.
The current adjusted 7-day moving average of SOPR (filtering out internal transfers) is near the neutral value of 1. This indicates that most active investors have neither realized significant profits nor losses, a sign of uncertainty.
Historically, cyclical lows have only been confirmed when this indicator falls below 0.98, marking a widespread sell-off across the market. The current lack of such signals suggests that despite heightened anxiety, the market has not yet experienced the deep losses needed to define a true bear market bottom.
Spot Market Neutralization
After establishing statistical boundaries for potential price outcomes through on-chain analysis, we can turn to off-chain data to assess sentiment from the perspective of exchange order books. A useful perspective is the Cumulative Volume Delta (CVD), which tracks the net difference between trades initiated by buyers and sellers, then aggregates this imbalance into a cumulative signal.
To measure shifts in spot market behavior, we compare the 30-day moving average of CVD with its 180-day median. In major venues like Coinbase and Binance, as well as in aggregated exchange flows, this bias has recently converged to zero. This represents a significant change from the strong buying pressure observed in April 2025, which drove a rebound from $72,000. While the slight positive value in July helped drive a rebound to $124,000, the broader trend now reflects the neutralization of spot sentiment, indicating that buyers' conviction at current levels is waning.
Perpetual Contracts Lean Bearish
In stark contrast to the neutral tone of the spot market, the situation in perpetual futures has decisively turned bearish. Since July, the CVD bias of Binance, Bybit, and aggregated exchanges has dropped into negative territory, indicating an increasingly imbalanced selling pressure. This suggests that perpetual traders (typically the more speculative segment of the market) have tended to short during the recent pullback.
That said, this indicator is highly volatile, often reaching extremes of buying and selling pressure in a short period. While the current bias highlights an increasing bearish trend, it should be closely monitored to confirm whether this negativity is a sustained trend or proves to be a temporary fluctuation in perpetual contracts.
Fragile Neutrality
To confirm the broader sentiment in the perpetual market, we can pair CVD analysis with funding rates, which track the costs of holding long and short positions. The 7-day moving average funding rate across major exchanges is currently around 0.01%.
This pattern indicates that while some leveraged traders are trying to bottom-fish, their buying is insufficient to change the overall balance. Instead, the market remains neutral but fragile, and a moderate increase in selling pressure could quickly shift sentiment to bearish.
Conclusion
Bitcoin's pullback to $111,000 is testing a critical range. Recent investor cost basis of $107,000–$108,900 marks key support; losing this will open the path to $93,000–$95,000, where a dense supply cluster might form a mid-term bottom. A rebound to $113,600 is possible but may encounter resistance as short-term holders under pressure sell during a rally.
Meanwhile, unrealized and realized losses remain shallow, and SOPR has not issued widespread sell signals. On-chain, spot demand has been neutralized, while perpetual futures lean bearish and weak. Overall, compared to past cycles, the current correction is mild, but buying conviction has weakened, keeping the market balanced between resilience and further downside.
