Market Analysis Points to Cooling Bitcoin Momentum
Bitcoin's recent rebound to $111,300 offers temporary relief for investors, but market analysts warn of an impending cooling-off phase that could extend through September. The cryptocurrency's 2.52% recovery from Monday's low of $108,550 masks underlying weaknesses in network fundamentals and institutional sentiment.
On-Chain Metrics Signal Warning
Glassnode's latest analysis reveals concerning trends in Bitcoin's on-chain activity. The monthly average of change-adjusted transfer volume has declined 13% from $26.7 billion to $23.2 billion, approaching the critical yearly average threshold of $21.6 billion. Breaking below this level would confirm weakening speculative activity and signal broader demand contraction.
Institutional Outflows and Macro Pressures
Spot Bitcoin exchange-traded funds continue experiencing sustained outflows, exacerbating bearish sentiment. Ecoinometrics research indicates that current flow-to-price models project Bitcoin potentially falling to $107,000, with risk of breaching the psychological $100,000 barrier if outflows persist. This aligns with heightened macroeconomic uncertainty and Federal Reserve rate cut expectations.
Historical Seasonal Weakness
September historically represents Bitcoin's weakest month, with an average return of -3.77% over the past 12 years. The third quarter has typically yielded negative returns, adding seasonal pressure to already fragile market conditions. Long-term holders are realizing substantial profits at levels second only to previous cycle peaks, indicating late-stage market behavior.
Expert Recommendations
Georgii Verbitskii, derivatives trader and TYMIO founder, advises adopting a "wait and see" approach rather than opening new long positions at current levels. He suggests that long positions only become viable if Bitcoin reclaims and sustains above $118,000. Despite long-term bullish outlooks, most analysts recommend caution through September's traditionally volatile period.