Bitcoin's Short-Term Selloff: A Buying Opportunity Amid Unchanged Long-Term Fundamentals

Bitcoin's recent pullback from $126,000 to $108,000 has sparked renewed debate about its near-term trajectory. While the selloff has rattled short-term sentiment, the long-term fundamentals-driven by institutional adoption, regulatory clarity, and network resilience-remain intact. For long-term investors, this correction represents a strategic entry point, provided they understand the technical and macroeconomic dynamics at play.

The Selloff in Context: Volatility as a Feature, Not a Bug

Bitcoin's 2025 price action has been anything but linear. After hitting a record high of $126,200 in early October, the asset has since retraced to the $108,000–$115,000 range, testing key technical levels like the 200-day simple moving average (SMA) at $109,000, according to an Investing.com analysis. This volatility is not unusual for Bitcoin, which has historically experienced sharp corrections during periods of macroeconomic uncertainty. For instance, the Federal Reserve's shifting stance on interest rates and inflationary pressures have created a risk-off environment, exacerbating short-term selling, according to a Coinotag report.

However, the selloff has not dented Bitcoin's underlying appeal. Prominent figures like MicroStrategy's Michael Saylor and Robert Kiyosaki remain bullish, with Saylor predicting a $150,000 target by year-end and Kiyosaki even more aggressive at $200,000, as reported in a Yahoo Finance article. Their optimism is rooted in Bitcoin's role as a hedge against fiat devaluation and its growing institutional adoption.

Technical Analysis: A Test of Support and Institutional Sentiment

From a technical perspective, Bitcoin's current price action suggests a critical inflection point. The asset has rejected at the 50 SMA and 23.6% Fibonacci retracement level, breaking below a multi-month rising trendline, according to that Investing.com analysis. A close below the 200 SMA at $109,000 would confirm a bearish bias, with the next support level at $107,000 (38.2% Fib) and a potential retest of the October low at $103,500, per the same analysis.

Yet, technical indicators also hint at a potential reversal. The Relative Strength Index (RSI) has already dipped below 50, signaling oversold conditions, while on-chain metrics like declining exchange balances suggest ongoing accumulation by long-term holders, as reported in the Yahoo Finance article. For a bullish turnaround, Bitcoin must reclaim the 200 SMA and push above $114,500 to establish a higher high. This would require renewed institutional demand, particularly from major players like MicroStrategy, which has slowed its Bitcoin purchases to 778 BTC in October-a stark drop from September's 3,526 BTC, according to a Coinotag analysis.

Institutional Buying Trends: A Tale of Two Markets

The third quarter of 2025 revealed a shifting institutional landscape. While Bitcoin surged to an all-time high, its market dominance fell to 56.9%, ceding ground to Ethereum and altcoins, according to a CryptoNews report. This shift was driven by massive inflows into US spot ETH ETFs, which outpaced Bitcoin ETFs for the first time, and aggressive buying by digital asset treasury companies (DATCos), as noted in that CryptoNews report.

However, Bitcoin's institutional appeal remains robust. Over 178 publicly traded companies now hold Bitcoin in their treasuries, collectively managing over 1 million BTC valued at $100 billion, according to a GlobeNewswire release. Innovations like Bitcoin Bancorp's partnership with Sailo Technologies to launch a treasury management platform further underscore the asset's institutional-grade infrastructure, as described in the GlobeNewswire release.

The key question is whether Bitcoin can rekindle institutional demand. If MicroStrategy and other major holders resume accumulation, the selloff could act as a catalyst for a rebound. Conversely, a prolonged absence of large-scale buying could delay Bitcoin's path to $150,000.

Long-Term Fundamentals: Unchanged and Unshaken

Despite the short-term turbulence, Bitcoin's long-term fundamentals remain unscathed. Regulatory developments in the US, including the SEC's support for tokenized securities and the Treasury's endorsement of stablecoins, have created a more favorable environment for adoption, according to a Coinotag article. Additionally, the U.S. government's creation of a Strategic Bitcoin Reserve signals growing recognition of the asset's strategic value, as noted in the 99Bitcoins report.

Network usage metrics also paint a bullish picture. Bitcoin's liquid supply increased by 12% in Q2 2025, while the illiquid supply (coins held for over a year) dipped only 2%, indicating strong long-term retention, per the 99Bitcoins report. Meanwhile, the DeFi sector's 40.2% growth in total value locked (TVL) highlights Bitcoin's role as a foundational asset in the broader crypto ecosystem, as documented in the CryptoNews report.

Strategic Entry Points: Timing the Rebound

For long-term investors, the current selloff offers a disciplined entry point. Historical patterns show that Bitcoin often rebounds after corrections, particularly when institutional demand reemerges. For example, during the 2020 and 2023 selloffs, Bitcoin recovered as macroeconomic clarity and institutional buying offset short-term fears, as previously reported by Coinotag.

The key is to focus on price levels that align with both technical and fundamental catalysts. A recovery above $114,500 would signal renewed bullish momentum, while a sustained break below $103,500 could test the asset's resilience. Investors should also monitor macroeconomic data, such as Fed rate decisions and inflation reports, which could influence risk appetite.

Conclusion: A Correction, Not a Collapse

Bitcoin's short-term selloff is a reminder of the asset's inherent volatility, but it is not a sign of systemic weakness. The long-term fundamentals-institutional adoption, regulatory progress, and network resilience-remain intact. For investors with a multi-year horizon, the current price action presents a disciplined opportunity to accumulate Bitcoin at a discount to its intrinsic value.

As always, patience and discipline will be rewarded. The next chapter of Bitcoin's story is being written, and those who understand the interplay of technical, institutional, and macroeconomic forces will be well-positioned to capitalize on the inevitable rebound.