Bitcoin Sell-Off Driven by Profit-Taking, Analysts Say

Bitcoin faced a significant sell-off on January 17, 2026, as profit-taking activity from long-term holders intensified. According to data, roughly 35,400 BTC—most of it profitable—were moved to centralized exchanges (CEXs) in the past 24 hours. This is the highest amount in nearly two months.

Outflows of unprofitable positions were minimal, with only about 4,600 BTC moving from holders who had not yet turned a profit. The profit-to-loss outflow ratio reached 7.5:1, signaling that the selling pressure was driven primarily by profit-taking, not panic selling.

Analysts note that investors who bought Bitcoin between $85,000 and $92,000 are now locking in gains as the price approaches their entry levels. This pattern suggests a more measured market response than a panic-driven dump.

Why Did This Happen?

The recent outflows reflect a broader trend of profit realization among long-term holders. The loss rate has dropped to one of its lowest levels, aligning with increased profit-taking activity.

Institutional and corporate buying has also played a role in supporting Bitcoin's price. Spot Bitcoin Exchange Traded Funds (ETFs) recorded a net inflow of $1.81 billion through Thursday, the highest weekly inflow since early October.

Michael Saylor's firm, Strategy Inc., continued its aggressive accumulation strategy, purchasing 13,627 BTC this week. This brings the company's total Bitcoin reserves to 687,410 BTC.

Bitcoin closed near $95,577 on January 17, after fluctuating between $97,109 and $95,122 in the past 24 hours. Despite the pullback, the price remains well above key support levels.

Retail demand has weakened, as seen in declining exchange open interest for Bitcoin, Ethereum, and XRP. Bitcoin's open interest dropped to $63 billion on Friday, down from $66 billion earlier in the week. This suggests some investors are losing short-term confidence.

Bitcoin's price is currently testing its cost basis zone. If the price rises above $97,000, it could attract more buyers and potentially push toward the $100,000 psychological level.

What Are Analysts Watching Next?

CryptoQuant analyst Axel warned that if the profit-to-loss ratio shifts—i.e., loss-driven selling begins— the downward pressure on Bitcoin could intensify. This is a key risk to monitor.

On-chain metrics suggest long-term holders are not rushing to sell. Value Days Destroyed (VDD) remains low at 0.53, indicating that older coins are staying dormant while newer ones are changing hands.

If VDD begins to rise, it could signal that long-term holders are starting to distribute their holdings, potentially leading to a broader sell-off. The current stability among long-term holders supports the idea of a more controlled price movement.

Bitcoin is also consolidating below the 100-day Exponential Moving Average (EMA) at $96,009. The Relative Strength Index (RSI) has stabilized at 64, indicating that the price is stable but lacks strong upward momentum.

The coming weeks will be critical for Bitcoin as it tests support at $95,000 and resistance at $97,000. Institutional demand remains strong, but any reversal in market sentiment or a shift in holder behavior could influence the price trajectory.