Bitcoin (BTC) has just experienced a tumultuous week, plummeting from a local peak of $110,000 to $103,000. As of the time of writing, the token's trading price is approximately $103,707, having fallen by 3.88% over the past seven days.

The biggest question now is: Has the market entered a deep correction phase?

Four consecutive sell signals

The net UTXO supply rate of Bitcoin has just issued four consecutive sell signals — a signal that cannot be ignored. Meanwhile, the UTXO Ratio index is also plummeting. When both of these indicators weaken simultaneously, the market is generally considered overheated.

In this context, the activity of investors taking profits has significantly increased, while demand shows signs of decline relative to existing supply.

The presence of these two factors indicates that the vast majority of BTC is in an unrealized profit state. This not only reduces the incentive for long-term holding (HODL) but also increasingly drives the trend of profit-taking.

Specifically, the net unrealized profit index of Bitcoin has dropped to 0.553, the lowest level in recent weeks.

This decline indicates that the profit margins for most investors are shrinking. This is a warning signal that suggests the market's growth momentum is clearly weakening.

In fact, investors who purchased BTC between $104,000 and $112,000 are now in a losing position.

The above two situations could lead to a market capitulation, meaning panic selling by investors, which would result in a deeper decline. In the current situation, the market needs a strong 'reset'.

This 'reset' opens up many potential scenarios for the price trend of Bitcoin in the near future.

In the near future, given the current market conditions, BTC may fluctuate within the accumulation area between $95,000 and $105,000 until the net UTXO supply ratio stabilizes around 0.85 - 0.9. This indicates that after a series of strong distribution signals, selling pressure has eased.

However, BTC may further retreat to the $92,000 area, completely clearing the current overbought condition.

Regardless of the situation, one point to note is that before the market finds a sustainable balance, the price of Bitcoin still faces the risk of dropping below the $100,000 mark.

Selling pressure intensifies — can $101,000 hold?

It is worth noting that in the case of poor profit indicators, the buy-sell ratio of market takers has been negative for four consecutive days. This clearly reflects the market's pessimism, with selling pressure being dominant.

If this negative trend continues, BTC may fall back to the support level of $101,488. If this price range cannot be maintained, it is inevitable that Bitcoin will break below the psychological threshold of $100,000. In this case, the next support area is around $98,890.