Bitcoin News Today: Bitcoin Enters Consolidation Phase Amid 7% Retrace and $3B Daily Profit-Taking

Bitcoin’s recent price movement reflects a transition from a strong uptrend to a consolidation phase, driven by increased profit-taking and market caution. Following a 7% retracement from its all-time high of $123,000 to around $114,000, the cryptocurrency has entered a period of sideways trading as traders seek to secure gains and hedge against potential volatility [1]. Renowned analyst Willy Woo has noted that this pause in bullish momentum suggests a reset is underway, with the possibility of a breakout attempt in August [1].

Profit-taking has surged to nearly $3 billion per day in July, according to Swissblock, signaling elevated caution among traders. However, this level of selling remains below the $4.5 billion sell-off seen in late 2024, indicating that this is more of a tactical cooldown than a sign of capitulation. The current conditions suggest that the market is not yet ready for a significant decline, provided macroeconomic and on-chain indicators remain stable [1].

Options market data reveals that traders are actively hedging against downside risks, particularly near the $105,000 level, while also positioning for potential rebounds above $120,000 by the end of the month. This is evidenced by the BTC 25 delta skew increasing between 4% and 6% across short-dated, 1-month, and 3-month options, reflecting bullish expectations for short-term price action. Deribit data further shows heavy trading in $105,000 put options for August expiries, highlighting the near-term bearish concerns among traders [1].

Spot market demand has also weakened, with the Coinbase Premium Index turning negative for the first time since May. This decline in U.S. investor demand aligns with the broader consolidation trend and suggests that renewed buying interest may be needed before a significant breakout occurs. A rebound in the CPI could serve as confirmation of increased demand and a potential resumption of upward momentum [1].

If the market remains stable and key metrics such as profit-taking and spot demand stabilize or improve, a breakout attempt could occur in August following this consolidation phase. Investors are advised to monitor both macroeconomic developments and on-chain data to assess the likelihood of a sustained move higher. The current market dynamics suggest a period of strategic positioning and risk management, with traders balancing short-term expectations against long-term potential [1].

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Source: [1] Bitcoin Momentum Shifts to Consolidation Amid Profit-Taking with Possible Range Between $105K and $110K (https://en.coinotag.com/bitcoin-momentum-shifts-to-consolidation-amid-profit-taking-with-possible-range-between-105k-and-110k/)