Bitcoin Price Stabilizes at $117K as ETF Demand Counters Liquidations

Institutional Buying Offsets Panic Selling After $1B in Liquidations

Bitcoin’s price action over the past 48 hours has been a case study in macro-driven volatility meeting structural market demand. Following a steep drop from $122,000 to lows of $117,200, triggered by hotter-than-expected U.S. PPI inflation and uncertainty around Treasury’s Strategic Bitcoin Reserve stance, leveraged long positions were obliterated. Data from CoinGlass shows more than 218,000 traders liquidated in a 24-hour span, with forced selling topping $1 billion in notional value — one of the largest single-day leveraged flushes of the quarter.
Yet, against that backdrop, BlackRock’s iShares Bitcoin Trust (IBIT) accumulated over $500 million in BTC in a single day, with its sister Ether ETF matching that buying volume. Combined ETF trade volumes in BTC and ETH spot products reached $11.5 billion, a liquidity footprint on par with daily trading in mega-cap equities like Apple. The divergence between panic-driven retail liquidations and methodical institutional accumulation suggests deep-pocketed players are treating dips toward the $117K–$118K region as strategic entry zones.

Technical Picture: Neutral Momentum, Bullish Structure, and Double-Top Risk

On the daily chart, Bitcoin has retreated from its $124,517 cycle high, forming a potential double-top pattern. Thursday’s candle printed a bearish engulfing formation on elevated volume — a warning of heightened seller aggression. The Relative Strength Index (RSI) sits at 55.1, signaling a neutral momentum state, while the MACD reading of 1,224.5 remains in bullish territory. The structure remains range-bound with clearly defined inflection points:

• Upside trigger: A daily close above $119,500–$120,000 on expanding volume would reset bullish momentum and open the door for a retest of $122,000–$124,000 resistance.

• Downside risk: Failure to defend $117,000 would confirm the double-top breakdown, setting up a measured move toward $113,000–$115,000 support.
  The 4-hour chart shows lower highs since the $124K peak, with selling volume spikes outpacing buy-side surges. While stochastic oscillators and CCI remain mid-range, all major EMAs and SMAs — including the EMA 200 at $102,562 and SMA 200 at $100,151** — continue to slope upward, affirming a broader bullish trend despite short-term softness.

CME Futures Gap and the $117.2K Pivot

Price behavior around $117,200 has been technically significant. This level nearly closed the latest CME Bitcoin futures weekend gap, a zone often targeted by professional traders for mean-reversion setups. Filling 75% of that gap before rebounding above the 4-hour 50 EMA suggests dip buyers are defending key liquidity pockets. Holding this level keeps the path open for $120K reclamation; losing it would likely accelerate sell programs targeting mid-$110Ks.

Macro Forces: Inflation Shock Reprices Fed Expectations

The macro catalyst behind the drawdown came from July’s PPI print — +3.3% YoY versus expectations for +2.5%, the fastest pace in three years. Month-on-month wholesale prices surged 0.9% against the 0.2% consensus, reviving fears the Fed may delay or scale back anticipated rate cuts. Treasury yields responded with the 10-year pushing to 4.33% and the 30-year near 4.9%, while the dollar index firmed, pressuring risk assets from equities to crypto.
Bitcoin’s intraday correlation with the Nasdaq 100 widened on the sell-off, underscoring its current behavior as a high-beta risk asset in macro stress. Short-term, the “Fed pivot” narrative has lost momentum, and ETF inflows will need to offset reduced rate-cut probability to sustain upside.

Geopolitics: Ukraine Peace Talks as a Volatility Variable

The scheduled summit between U.S. President Trump and Russian President Putin in Alaska has injected another volatility vector. Historically, as seen in February–March 2022, BTC has sold off sharply at the onset of geopolitical shocks before staging aggressive rebounds once markets reprice macro impacts.
Three potential scenarios:

• Comprehensive ceasefire → Energy prices ease, inflation pressure subsides, Fed rate cuts more likely; risk sentiment improves, likely boosting Bitcoin ETF inflows.

• Fragile truce → Choppy headline-driven swings, Bitcoin stuck in range, macro taking a backseat to crypto-specific flows.

• Escalation → Immediate correlation trade with equities on risk-off selling; potential delayed bounce as capital seeks censorship-resistant assets and stablecoins, later rotating back into BTC.

Cycle Context: BTC’s Outperformance in USD, Lag vs. Gold and Nasdaq

From the last bear-market lows, Bitcoin has delivered a ~634% rally, with its largest drawdown this cycle only 32% — far milder than previous cycles where corrections exceeded 50%. Price structure has followed a “step-up” pattern: rapid advances, sideways consolidation, then fresh breakouts.
However, when measured against Gold or the Nasdaq Composite, BTC’s performance looks more subdued. In gold-adjusted terms, Bitcoin remains below its 2021 peak, highlighting that much of the USD-denominated rally has been influenced by fiat currency debasement rather than pure purchasing-power gains. Adjusting for global liquidity growth (M2 expansion) paints an even flatter picture — a key reason retail exuberance has not yet matched prior euphoric peaks.

On-Chain & Market Structure: Long-Term Holders Unshaken

Despite short-term turbulence, on-chain metrics show a high percentage of BTC in long-term storage, with supply last active over one year holding near record highs. This illiquid supply dynamic, combined with consistent ETF absorption, suggests that structural support under the market is stronger than in previous cycle peaks. The market cap sits at $2.36 trillion with 24-hour spot volume at $95.5B, healthy liquidity levels for breakout potential if resistance levels are cleared.

Environmental Narrative Still Shadowing BTC vs. ETH

The surge toward $124,000 reignited the ESG debate. Bitcoin’s proof-of-work network consumes 138–178 TWh/year, with a carbon footprint near 40 million tonnes CO₂ annually, versus Ethereum’s post-Merge 0.0026 TWh/year. While renewable mining initiatives and waste-heat recovery projects are gaining traction, ESG-focused funds may still prefer ETH in allocation models. This remains a medium-term headwind for certain classes of institutional capital flowing into BTC.

Verdict: Buy, Sell, or Hold?

Given the alignment of long-term bullish moving averages, resilient institutional demand (BlackRock ETF inflows), and strong on-chain holding behavior, Bitcoin retains a bullish bias above $117,000. However, the presence of a potential double-top at $124K, macro headwinds from sticky inflation, and underperformance vs. gold in real terms temper near-term expectations.
Rating: Buy on dips into $115K–$118K with tight risk management; target a retest of $122K–$124K. A breakout above $120K on volume confirms the upside case; a daily close below $117K invalidates and shifts bias toward $113K.

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