Is Bitcoin's Bull Market Reaching Critical Inflection Point?

Bitcoin’s price action in August 2025 has painted a mixed picture for investors. After a sharp correction from its all-time high of $124,400 to a critical support zone between $110,000 and $112,000, the market now faces a pivotal juncture. Technical indicators, on-chain metrics, and historical cycle analysis all point to a potential inflection point—raising the question: Should investors lock in gains, hedge exposure, or remain bullish ahead of anticipated volatility?

Technical Indicators: A Tug-of-War Between Bulls and Bears

Bitcoin’s immediate support zone at $110,000–$112,000 has historically acted as a psychological and technical floor [1]. A sustained break below $110,000 could trigger a deeper correction toward $100,000, while a rebound above $115,000–$117,000 could reignite bullish momentum [2]. However, the 50-day moving average crossing below the 200-day MA—a bearish “death cross”—casts doubt on the sustainability of a short-term rally [3].

The RSI on the 4-hour chart shows a bullish divergence, suggesting a potential rebound [3], but this must be weighed against the broader bearish trend. Meanwhile, the 3-month cost basis of $113.6K represents a critical resistance level where short-term holders may seek breakeven exits [1].

On-Chain Metrics: Supply in Profit and Institutional Dynamics

Bitcoin’s supply in profit has reached a historically critical threshold, with 97.2% of the circulating supply held above cost basis [4]. This exceeds the long-term average of 75% and aligns with historical patterns where such metrics often signal pivotal turning points [4]. However, a drop below 90% could trigger a corrective phase, as seen in past cycles [4].

Institutional adoption remains a bullish counterweight. Corporate holdings, including MicroStrategy’s accumulation of over 632,000 BTC, and ETF inflows have reinforced structural demand [5]. Yet, recent ETF outflows of $1.17B in August 2025 highlight the market’s maturing nature, where liquidity shifts can amplify volatility [4].

Historical Cycle Analysis: The Pi Cycle Top and Market Phases

Bitcoin’s four-year cycle, tied to halving events, suggests a potential peak as the 111DMA approaches the 350DMA x2 threshold. The Pi Cycle Top Indicator, historically accurate in identifying cycle highs, projects a crossover on September 17, 2025 [6]. This date coincides with a potential market top, as seen in 2013, 2017, and 2021 [6].

The Puell Multiple, currently at 1.39, indicates moderate miner profitability, well below the “overheated” threshold of 2.2 [7]. This suggests miner selling pressure is manageable, but rising values could signal overvaluation in the near term [7].

Strategic Implications for Investors

For investors, the data presents a nuanced outlook. If Bitcoin holds above $110,000, the next target is $111K–$116K, with a potential resumption of the bullish trend toward $125K [2]. However, a break below $110K could trigger a deeper correction to $92K–$93K [2].

Given the Pi Cycle Top’s projected crossover in late September and the fragile on-chain momentum, a cautious approach is warranted. Investors should consider hedging exposure through trailing stops or partial profit-taking at key resistance levels like $113,500 and $112,000 [3]. For long-term holders, the structural demand from institutions and macroeconomic tailwinds (e.g., dovish Fed policy) provide a compelling case to remain bullish [5].

Conclusion

Bitcoin’s bull market is at a crossroads. While technical and on-chain indicators suggest a potential top, the interplay of institutional adoption and macroeconomic factors introduces uncertainty. Investors must balance the risks of a near-term correction with the long-term fundamentals driving Bitcoin’s adoption. As the market approaches the projected Pi Cycle Top in late September, vigilance and flexibility will be key.

Source:
[1] Bitcoin Price Analysis Today: Key Resistance at $113.6K Looms [https://www.tradingview.com/news/financemagnates:4d6261b6c094b:0-bitcoin-price-analysis-today-key-resistance-at-113-6k-looms/]
[2] Bitcoin Price Analysis: Key Support and Resistance Levels Watch Strategic Entry Exit Points [https://www.ainvest.com/news/bitcoin-price-analysis-key-support-resistance-levels-watch-strategic-entry-exit-points-2508/]
[3] Bitcoin Technical Analysis Report | 25th August 2025 [https://zebpay.com/in/blog/bitcoin-technical-analysis-report-25th-august-2025]
[4] Bitcoin Supply In Profit Hits Historical Threshold [https://www.mitrade.com/insights/news/live-news/article-3-1077244-20250829]
[5] Bitcoin to hit $1.3M by 2035 as institutions drive demand [https://www.tradingview.com/news/cointelegraph:88346f01a094b:0-bitcoin-to-hit-1-3m-by-2035-as-institutions-drive-demand-bitwise/]
[6] Bitcoin: Pi Cycle Top Indicator [https://www.bitcoinmagazinepro.com/charts/pi-cycle-top-indicator/]
[7] Bitcoin Puell Multiple [https://newhedge.io/bitcoin/puell-multiple]