Bitcoin Price Drops to $116K, Triggers 'Buy the Dip' Speculation Amid Economic Pressures and Institutional Interest

Bitcoin's price fell from over $124,000 to under $116,000 in August 2025, sparking "buy the dip" discussions. Market volatility persists due to macroeconomic factors, increased whale buying, and institutional interest. Despite economic pressures, institutional actors support a potential rebound, but short-term risks remain formidable.

Bitcoin's price fell from over $124,000 to under $116,000 in August 2025, sparking "buy the dip" discussions among investors. The market volatility is attributed to macroeconomic factors, increased whale buying, and institutional interest. Despite economic pressures, institutional actors support a potential rebound, but short-term risks remain formidable.

The market's volatility is highlighted by a series of flash crashes and sharp price swings. On August 18, a large whale dumped 24,000 BTC, triggering $550 million in liquidations [3]. A few days later, on August 21, Bitcoin plunged $4,000 within minutes, signaling a sharp spike in intraday volatility [3]. Over the next 24 hours, liquidations reached $642 million, wiping out large leveraged long positions as the market struggled to stabilize [3].

Institutional actors, however, remain optimistic. Eric Trump, son of former U.S. President Donald Trump, stated at BITCOIN ASIA 2025 that “there is no doubt that Bitcoin will reach $1 million” [1]. Market analysts emphasize that public statements convey sentiment rather than constitute empirical price forecasts [1].

Bitcoin's price action in late August 2025 has painted a complex picture of market dynamics. The asset is currently trading within a descending channel on the 4-hour chart, with key support levels at $110,000–$112,000 and resistance near $113,600 [2]. This pattern, combined with on-chain momentum indicators like the MVRV death cross and NVT ratio, suggests a critical juncture for investors seeking to navigate the current correction.

The MVRV (Market Value to Realized Value) ratio has compressed to 1.0, indicating a rebalancing of speculative and long-term investor sentiment [2]. The NVT (Network Value to Transactions) ratio stands at 1.51, nearing its overbought threshold of 2.2 [2]. This suggests Bitcoin’s valuation is increasingly driven by utility and macroeconomic factors rather than speculative trading volume.

Despite the volatility, Bitcoin's historical volatility index (BVOL) is at historic lows of 13.17 [4]. This compression often precedes significant directional moves. For strategic entry points, investors are advised to employ dollar-cost averaging (DCA) near $111,900 and high-conviction buys below $100,000 [2].

In conclusion, Bitcoin's current price action reflects a market at a crossroads. While technical indicators like the MVRV death cross and descending channel suggest short-term bearishness, on-chain data reveals strong institutional accumulation. Investors should prioritize risk management, using key support levels and volatility metrics to time entries. A breakout above $113,600 could reignite bullish momentum, but a breakdown below $107,000 would test the resilience of the long-term bull case.

References:
[1] https://en.coinotag.com/breakingnews/eric-trump-predicts-bitcoin-will-reach-1-million-at-bitcoin-asia-2025-everyone-is-buying-bitcoin/
[2] https://www.ainvest.com/news/bitcoin-short-term-volatility-strategic-entry-points-technical-chain-analysis-2508/
[3] https://www.ainvest.com/news/bitcoin-news-today-cryptocurrency-stocks-assets-plunge-market-volatility-642m-liquidations-2508/
[4] https://www.tradingview.com/symbols/BVOL/ideas/