Bitcoin News Today: Bitcoin STH Cost Basis Drives 7% Correction Risk With $110K Support and $140K Resistance in Focus

Bitcoin’s price trajectory remains under the microscope as data from on-chain analytics firm Glassnode highlights potential pivotal support and resistance levels influenced by short-term holders (STHs). The analysis, published in Glassnode’s “The Week Onchain” newsletter, underscores the role of STHs—holders of Bitcoin for up to 155 days—in shaping near-term price dynamics. These investors, whose collective cost basis often acts as a support mechanism during bull markets, may dictate critical turning points for BTC/USD in the coming weeks.

Glassnode identifies a “cost basis gap” between $115,000 and $110,000, a region where limited trading activity occurred during Bitcoin’s recent rapid ascent from $110,000 to $115,000 this month. This absence of accumulated cost basis creates a vacuum that could pull prices downward to fill the void, a phenomenon akin to gap-filling observed in Bitcoin futures markets. The firm notes that STHs have concentrated cost basis levels between $117,000 and $122,000, indicating prior accumulation at higher prices. However, the underutilized $110,000–$115,000 range leaves room for a potential 7% correction, testing a key support level at $110,000[1].

Conversely, a breakout scenario is also in play. If Bitcoin surges past its recent high, short-term profit-taking by STHs could cap upside momentum. Glassnode employs standard deviation analysis to project a possible resistance zone around $140,000, where sell-side pressure may intensify. This level aligns with the +2σ band in the cost basis distribution, suggesting a high probability of increased selling activity if the price retests this area during a rally[1].

The interplay between these dynamics hinges on STH behavior. Their aggregated purchase price—derived from historical trading activity—creates a “ladder” of support levels as new investors enter the market. When combined with profit-taking patterns, these metrics form speculative price targets. For instance, a sustained move above $140,000 could trigger rapid selling from STHs who profit at that threshold, while a pullback to $110,000 might see renewed buying interest as the price fills the identified gap.

Glassnode’s methodology emphasizes the gravitational pull of cost basis distribution, a concept where prices naturally gravitate toward areas of significant accumulation or depletion. While the firm acknowledges that gaps like the $110,000–$115,000 range are not guaranteed to be retested, the structural imbalance in this zone warrants close monitoring. This analysis aligns with broader on-chain trends observed in derivatives markets, where price gaps often attract liquidity to close imbalances[1].

The implications for traders and investors are twofold: a potential 7% dip to $110,000 could offer a buying opportunity for STHs, while a breakout above $140,000 might trigger profit-taking that limits further gains. The latter scenario, however, requires overcoming immediate resistance from the same cohort that has previously provided support. As such, the next price action will likely reflect the balance between STH accumulation and distribution behaviors, with Glassnode’s metrics serving as a guide for risk assessment.

Source: [1] Bitcoin Short-Term Holders Spark New BTC Price Targets (https://coinmarketcap.com/community/articles/6889e4dcb68c6f644094b375/)