Bitcoin’s $110K Support Test and Institutional Conviction in a Volatile Bull Run

Bitcoin’s recent price action around the $110,000–$112,000 range has become a focal point for investors, as technical, on-chain, and institutional forces collide. While retail sentiment remains bearish, institutional conviction—driven by ETF inflows, corporate treasuries, and strategic accumulation—suggests a deeper narrative of long-term confidence. This divergence between retail panic and institutional resolve is shaping a volatile but potentially pivotal phase in Bitcoin’s bull run.

Institutional Accumulation: A Pillar of Long-Term Confidence

Institutional buyers have continued to accumulate Bitcoin despite short-term volatility. BlackRock’s recent addition of $51 million in BTC underscores this trend, with the firm now controlling 3% of the total supply via its IBIT ETF [1]. Meanwhile, corporate treasuries like MicroStrategy’s $73.96 billion BTC hoard have removed nearly 2 million BTC from circulation, tightening supply and reinforcing Bitcoin’s scarcity narrative [6]. These actions signal a systemic shift toward institutional adoption, with ETFs now holding $156 billion in AUM [6].

On-chain metrics further validate this conviction. The 30-day MVRV rate of -3.37% indicates undervaluation, while the STH Realized Price aligning with the 200-day SMA around $100K–$107K suggests accumulation opportunities [3]. Additionally, 90% of Bitcoin’s circulating supply is above cost basis, a historically elevated metric that often precedes pullbacks but also highlights the asset’s inherent resilience [1].

Retail Sentiment: Overextended Bearishness and Mixed Signals

Retail investor sentiment, however, tells a different story. Short liquidations have surged to $3.7 billion in the past week, with 50.66% of positions on major exchanges like Binance and Bybit being short [1]. The Bitcoin Fear and Greed Index remains neutral at 50–51, indicating neither extreme panic nor euphoria [4]. This divergence between technical bearishness and sentiment neutrality suggests retail investors are cautious but not yet capitulating.

Whale activity has added to the uncertainty. A $4.77 billion BTC transfer from a dormant wallet triggered a 0.70% price drop, raising fears of forced liquidation [5]. Conversely, a $11 billion whale rotating $2.59 billion into Ethereum highlights shifting institutional preferences [2]. These mixed signals reflect a market in transition, where strategic accumulation and profit-taking coexist.

Technical Outlook: A Rebound or Deeper Retracement?

Bitcoin’s price has fallen below the $112,500 resistance, with immediate support at $108,500 and the 100-hour SMA [5]. The MACD and RSI indicators trend bearishly, but oversold conditions—RSI at 39.94 and Stochastic Oscillator at 12.34—suggest a potential rebound could be imminent [6]. A successful defense of the $108,666 support level could trigger a move toward $115,000, particularly if ETF inflows and macroeconomic tailwinds continue to provide support [6].

Conclusion: A Battle of Narratives

Bitcoin’s $110K support test is more than a technical milestone—it is a battleground between institutional conviction and overextended retail sentiment. While short-term bearish pressures persist, the alignment of on-chain metrics, ETF inflows, and corporate treasuries suggests a long-term bullish narrative. Retail investors, meanwhile, face a landscape of tactical entry opportunities and heightened risks, as macroeconomic factors and whale behavior continue to shape market direction.

For now, the market’s next move hinges on whether institutional accumulation can outweigh retail capitulation. A successful defense of $110K could reignite the bull run, while a breakdown might test deeper support levels. Investors must weigh these dynamics carefully, as the interplay between institutional and retail forces defines Bitcoin’s path forward.

Source:
[1] Bitcoin Price Analysis: Tests $110K Support As BlackRock Adds $51M BTC [https://www.thecoinrepublic.com/2025/08/29/bitcoin-price-analysis-tests-110k-support-as-blackrock-adds-51m-btc/?amp]
[2] BTC Slips Under $110K, ETH Accumulation Builds, SOL Sentiment Peaks [https://margex.com/en/blog/btc-slips-under-110k-eth-accumulation-builds-sol-sentiment-peaks/]
[3] Bitcoin's Critical $110K–$112K Range and the Battle for Bullish Control [https://www.ainvest.com/news/bitcoin-critical-110k-112k-range-battle-bullish-control-2508/]
[4] Live Crypto Fear and Greed Index (Updated: Aug 26, 2025) [https://www.bitdegree.org/cryptocurrency-prices/fear-and-greed-index]
[5] BTC Falls Below $110000, Is It a Short-Term Adjustment or Deeper Retracement? [https://www.odaily.news/en/post/5205913]
[6] Bitcoin's Correction Below $110000: A Buying Opportunity in Institutional Strength [https://www.ainvest.com/news/bitcoin-correction-110-000-buying-opportunity-institutional-strength-2508/]