Bitcoin has retreated below $65,000 after failing to hold above this key resistance level, marking a significant pullback from the earlier CPI-driven rally that had pushed the cryptocurrency toward $65,470. According to crypto.news, the rally lost momentum almost immediately as sellers emerged around a major resistance zone, pushing Bitcoin back toward $64,000. Market sentiment has turned cautious as traders weigh improving inflation data against renewed macro and on-chain headwinds, with the latest pullback leaving traders split over whether this represents a pause before another breakout or the start of a deeper correction. Despite the macroeconomic tailwind from softer inflation data, Bitcoin has slipped back into the red, trading at $64,720 with a 0.13% decline over the past 24 hours.
Recent Bitcoin buyers are experiencing unprecedented selling pressure, with monthly realized losses reaching a record $90 million according to AMBCrypto. The 30-day average of Bitcoin sent to exchanges at a loss has climbed to 2,450 BTC, indicating that investors who bought between $75,000 and $126,000 are now incurring losses rather than waiting for a recovery. This capitulation trend suggests recent buyers are absorbing larger losses because they entered the market at much higher prices compared to current levels. The pressure becomes even clearer as monthly realized losses reach a record $90 million, exceeding previous capitulation phases, with short-term holders who purchased near recent lows taking profits at volumes exceeding $4 million per day. Glassnode notes that two forces are anchoring the rally simultaneously: cycle-top buyers reducing losses into strength and local-low buyers locking in gains, both selling into the same price recovery.
New buyers are stepping in at each opportunity to absorb available supply rather than a second round of distribution from the STH base, according to recent data. This trend is being displayed clearly within the $62,000-$65,000 range, where a new cost basis was created when Bitcoin bounced from its low point at $57,000. The increased demand for this area also lends support to the idea that this range is likely to provide near-term support for Bitcoin. With BTC trading around $64,700-$65,000, attention has shifted to the $66,000 resistance, which represents the confirmation price point for investors to be confident they are in possession of a "new" cost basis for the asset. If a strong price move breaks through $66,000, then it would likely strengthen the conviction that the upside momentum will continue, while failure to reclaim that level may prompt recent buyers to exit, reviving short-term selling pressure.
Bitcoin spot ETF volume has collapsed 78% from its peak, with daily volume dropping to $1.2 billion versus $4.4 billion at the top, according to AMBCrypto. This decline suggests that ETF-driven demand has cooled, leaving the market with weaker liquidity as BTC attempts to sustain its recovery. Bitcoin is up over 9% so far in Q3, marking its first green quarter after averaging nearly 20% losses across the previous three quarters, but rising profit-taking is expected as short-term holders look to secure gains after the strong recovery. The Entity-Adjusted Long-Term Holder Realized Loss, which peaked two weeks ago and has now declined, shows the pace of selling has turned, with the firm flagging this as the precondition for any durable recovery.
The technical picture presents a mixed but resilient outlook for Bitcoin's near-term direction. The 4-hour chart shows Bitcoin maintaining an ascending trendline that has supported every major pullback since early July, with BTC price briefly breaking below the trendline before reclaiming it. Aroon Up remains above 64 while Aroon Down sits near zero, suggesting buyers still control the intermediate trend despite the recent setback. The daily chart shows Bitcoin struggling to reclaim the 78.6% Fibonacci retracement level near $63,205 on a sustained basis while facing repeated rejection below $65,500. Analyst Ted Pillows argues that Bitcoin needs a daily close above $65,000 for strong expansion, warning that failure to do so could erase all short-term gains. The Sell-Side Risk Ratio continues declining, signaling growing seller exhaustion, while apparent demand has improved from nearly -275,000 BTC to -172,960 BTC, with neutral funding rates and range-bound Open Interest suggesting stronger Spot demand is still needed to confirm a sustained recovery.
