Key Takeaways
Is Bitcoin forming a potential market bottom?
Yes — Buy-Sell Pressure data signals a potential bottom, with BTC in a “bullish zone” while short traders face increasing risk.
What’s driving the current market divergence?
Institutions and spot investors briefly turned sellers, but rising Funding Rates and liquidation clusters suggest a possible short squeeze ahead.
Bitcoin [BTC] has yet to recover from the sharp decline it suffered on the 11th of October, which triggered a broader market downturn.
Trading at $107,510 at press time, the asset remained under selling pressure. However, new market indicators suggest that sellers may be betting on the wrong side.
Relief inflows and strengthening bullish signals could pave the way for a rally—potentially putting short traders at a loss.
Bitcoin bottom reach?
Buy-Sell Pressure data from Alphractal has begun signaling that a potential Bitcoin bottom may be forming.
The chart shows Bitcoin still in the green phase—its bullish zone—but approaching the red phase, where selling pressure typically intensifies.
Ordinarily, this would imply that Bitcoin could see a natural decline. However, analyst Joao Wedson noted a subtle distinction, saying.
“The 2025 cycle looks very different — it shows weaker, more subdued demand, nothing close to the euphoric spikes we witnessed in the past.”
He added that, unlike previous market cycles in 2017 and 2021, the current cycle appears more restrained—implying a potential euphoric phase could still lie ahead, which may drive the asset higher.
A more intriguing trend is visible in the Bitcoin/Gold chart, which shows Bitcoin continuing to rise against gold, posting an 8% gain in the past 24 hours.
Source: Alphractal
This indicates that more capital is moving into Bitcoin compared to gold—which, notably, just recorded its steepest single-day decline in over a decade.
In an Email to AMBCrypto, Farzam Ehsani, Co-founder and CEO of VALR, explained that this shift from gold to Bitcoin is expected, stating:
“Investors taking risk off the table in one asset are likely to seek asymmetric upside in another, especially one still perceived as undervalued and under-owned relative to its potential.”
Institutions and spot investors diverge
Institutional and spot investors currently do not share the same bullish sentiment.
Institutional investors through U.S. spot Bitcoin ETFs sold $101.3 million worth of BTC, while retail investors offloaded an even larger $165 million at the time of publication.
Source: SosoValue
This appears to be a cooling phase, as both groups were net buyers the previous day. Institutional investors accumulated $477.19 million worth of Bitcoin with no outflows, while spot investors purchased $435.37 million.
Adding to the outlook, CryptoQuant data shows a recent surge in Bitcoin’s Funding Rate. At the time of writing, the total Funding Rate had turned positive, climbing to 0.0067% after previously dipping below zero.
The gradual alignment of retail, institutional, and derivatives activity places short traders at increasing risk.
Short squeeze on the horizon?
The liquidation heat map suggests the market could soon force short traders out of their positions.
With bullish momentum building, Bitcoin may be gearing up for an upward surge. Since most unfilled orders currently lie below the spot price, a rally could trigger a short squeeze—forcing short sellers to exit the market.
Ehsani added that heading into Q1 2026, Bitcoin still holds a bullish outlook:
“BTC could reach $130,000 – $132,000, provided market conditions are not further hampered by macro volatility.”
Source: CoinGlass