Key points:
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Bitcoin short-term holders are showing classic profit-taking behavior, sending BTC to exchanges.
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Their presence among exchange inflows has reached a level associated with “local bottoms” on BTC/USD.
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A popular bid level on Binance now sits at $117,500.
Bitcoin (BTC) may be putting in its next local bottom as retail investors offload profits, new research says.
In a QuickTake blog post released on Wednesday, onchain analytics platform CryptoQuant eyed a key event for BTC price action.
Bitcoin exchange inflows spark new price signal
Bitcoin retail investors are reducing BTC exposure as price hovers around $120,000, CryptoQuant confirmed.
Exchange flows, however, are nuanced; inbound transactions are increasingly coming from newer investors, commonly known as short-term holders (STHs).
“Increased Short-Term Holder (STH) Activity on Binance Signals Potential Profit-Taking,” contributor Amr Taha summarized.
Taha highlighted the Binance Exchange Inflow Ratio for STHs, which shows the proportion of inbound transactions to Binance coming from entities hodling for six months or less.
The ratio recently crossed 0.4, something Taha shows “often coincides with local bottoms.”
“The latest spike above 0.4 suggests that retail participants may have started depositing their Bitcoin holdings en masse to Binance, likely in an attempt to secure profits following a strong upward price trend,” he said.
“The STH cohort — typically holding BTC for less than 155 days — has a tendency to sell during upward trends, and the current ratio reinforces this behavior.”
All-time highs last week prompted a mass reawakening of trading activity across crypto exchanges.
“Among all venues, Binance recorded the largest single‑day increase in spot trading volume both on the day before and the day after the new high, thereby capturing additional market share the days after the peak–52% on July 18,” CryptoQuant reported in a separate Quicktake post.
“Crypto.com, Coinbase, Bybit and OKX also showed a relatively high spot trading volume.”
BTC price bid interest puts focus on $117,500
As Cointelegraph noted, analysis has already called the onset of “seller exhaustion” after extensive profit-taking caused BTC/USD to whipsaw between $116,000 and $120,000.
Related: Bitcoin bull run ‘likely close to over’ says trader as XRP flips McDonald’s
Traders still expect another upside leg for Bitcoin, even as attention and capital rotate into altcoins.
Exchange order-book bid liquidity favors $117,500 as a price “magnet,” monitoring resource CoinGlass highlighted on X on Wednesday.
Large liquidity clusters continue to shape low-timeframe moves on BTC/USD.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
