Bitcoin News Today: Bitcoin Retraces to 7-Day Low Amid Profit-Taking and Cooling Demand

Generated by AI AgentCoin World
Thursday, Aug 21, 2025 10:23 pm ET2min read
BTC
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Aime RobotAime Summary

- Bitcoin fell to a 7-day low near $112,500 after a sharp correction from its $124,500 peak, driven by profit-taking, cooling institutional demand, and macroeconomic concerns.

- Large holders locked in $9B in July profits, while ETF outflows hit $523M, signaling reduced institutional buying and risk-averse investor behavior.

- Hawkish Fed signals and hot inflation data worsened market sentiment, dragging Bitcoin lower amid broader risk-asset selloffs despite its macroeconomic resilience.

- Retail participation dropped to bull market lows, and technical indicators like RSI/MACD show bearish momentum below key support levels near $112,500.

- Market focus shifts to Fed Chair Powell’s Jackson Hole speech and PMI data, with long-term optimism tempered by near-term volatility and macroeconomic sensitivity.

Bitcoin's recent price action has triggered a sharp correction, with BTC/USD retreating from an all-time high of $124,500 on August 14 to a 7-day low near $112,500 [4]. The pullback has sparked speculation over the drivers behind the selloff, with on-chain data, macroeconomic factors, and investor sentiment all playing pivotal roles in the downward trend.

One of the most immediate triggers was a sharp rise in profit-taking activity, particularly among large holders. Whale investors alone realized over $2 billion in profits on August 16, while overall holder profits reached $9 billion in July—the highest monthly total of the year [5]. This trend indicates a shift toward risk aversion, with investors locking in gains following the recent rally.

Institutional demand has also shown signs of cooling. According to data from CryptoQuant, Bitcoin’s Apparent Demand fell from a peak of 174,000 BTC in July to 59,000 BTC by August 21 [5]. Meanwhile, net ETF purchases have dropped to their lowest levels since April 25, signaling a reduction in institutional buying pressure. The week of August 20 saw BTC ETFs record outflows of $523.3 million, the second-largest in August after the peak on August 1 [5].

The broader macroeconomic environment has further exacerbated the selloff. Recent economic data has cast doubt on the likelihood of a September rate cut. The July FOMC minutes revealed a hawkish tone from the Federal Reserve, while hotter-than-expected Producer Price Index (PPI) readings increased concerns over inflation persistence [6]. These developments have led to a broader selloff in risk assets, with

Bitcoin
not spared despite its historical resilience to macroeconomic shocks.

Retail investor participation has also seen a marked decline, with Bitcoin retail transfers reaching their lowest levels since the bull market began [1]. This suggests a loss of confidence among smaller investors, a trend that can amplify price declines in the highly leveraged and speculative crypto market.

On the technical side, Bitcoin is currently testing key support levels near $112,500. This level is significant as it aligns with the Trader On-chain Realized Price, where unrealized profits turn neutral [5]. However, the price remains below the 50-day EMA of $114,886, and both the RSI and MACD indicators are showing bearish momentum, pointing to continued downward pressure in the near term [5].

The coming week will be critical in determining the direction of Bitcoin. Traders are closely watching the preliminary

S&P Global
manufacturing PMI and Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole Symposium for potential clues on the future of monetary policy [5]. A shift in the narrative around rate cuts could reignite bullish momentum, but for now, the market appears to be in a consolidation phase, with investors adopting a more cautious stance.

Despite the recent downturn, the long-term outlook for Bitcoin remains broadly positive. Historically, major price corrections have often been followed by strong rebounds, particularly when accompanied by robust on-chain accumulation and renewed buying interest at lower prices [5]. However, the near-term volatility underscores the increasing influence of macroeconomic factors and investor sentiment on the world’s largest cryptocurrency.

Source:

[1] Bitcoin Retail Transfers Collapse: Lowest Since Bull Market ... (https://www.mitrade.com/insights/news/live-news/article-3-1059726-20250822)

[4] Cryptocurrencies: Bitcoin Quickly Retreats From Record High (https://seekingalpha.com/article/4815451-cryptocurrencies-bitcoin-quickly-retreats-from-record-high)

[5] Bitcoin Price Forecast: BTC steadies as traders await ... (https://www.fxstreet.com/cryptocurrencies/news/bitcoin-price-forecast-btc-steadies-at-113-500-as-traders-await-powells-jackson-hole-speech-202508210930)

[6] Bitcoin sinks following hotter-than-expected inflation print ... (https://www.aol.com/finance/bitcoin-touches-record-high-crypto-231411309.html)