6 Minutes
Bitcoin price clings to $113K as cooling demand suggests more downside
Bitcoin (BTC) is holding around $113,770 at press time, trading in a tight range after a week of sideways price action. Despite a marginal 0.02% gain in the last 24 hours, BTC has lost roughly 8% over the past week, sliding further below the all-time high of $124,128 recorded earlier this month. That 8.4% gap has shifted market sentiment from euphoric to cautious, raising questions about whether buyers will step back in or if additional downside lies ahead.
Volume and open interest point to a cautious market
On-chain and derivatives metrics underscore a cooling market. CoinGlass reports that Bitcoin open interest eased by 0.36% to $37.9 billion in the previous 24 hours, with perpetual futures accounting for most of the decline. Trading volume over the same period dropped 7.32% to $66.41 billion. The combination of falling volume and shrinking open interest usually signals position trimming by traders and a broader market pause.
The pause is consistent with investors locking in gains after a strong run earlier in the month. When open interest and trading volume decline together, it typically points to reduced speculative activity and a market that is digesting recent moves rather than extending them.
Demand softening: institutions and smart money reduce exposure
Recent data from CryptoQuant paints a clearer picture of how demand has cooled. Market accumulation of Bitcoin has fallen sharply — from about 174,000 BTC in July to roughly 59,000 BTC currently, a decline of nearly two-thirds. Institutional appetite has also moderated: net purchases into Bitcoin exchange-traded funds over the past month totaled only about 11,000 BTC, the lowest monthly inflow since April.
Corporate and whale accumulation has slowed as well. Holdings by major entities such as Strategy fell from 171,000 BTC in November 2024 to about 27,000 BTC over the last 30 days. At the same time, both short-term and long-term holders have been realizing profits — CryptoQuant estimates roughly $74 billion in net profits realized since July 4, with an additional $2 billion captured by new whale investors. Large-scale profit-taking tends to increase selling pressure and boost near-term volatility.
CryptoQuant’s Bull Score recently shifted from an "Extra Bullish" reading to a "Bullish Cooldown," indicating that while the longer-term setup remains constructive, the short-term momentum has faded. The analysis suggests downside risk may be limited for now, with support likely around $110K — a level where holders historically show more resistance to selling aggressively.
Still, the market is on watch: if demand does not return and profit-taking persists, BTC could find it difficult to regain momentum. Traders will be monitoring volume, open interest, and ETF flows for signs of renewed institutional buying that could reverse the current bearish cues.
XRP experiences a pullback amid lower network activity and fading smart-money demand
XRP has risen significantly year-to-date, trading around $2.93 and up roughly 19% over three months. The token’s market capitalization reached about $173.8 billion with daily volume near $6.4 billion. Much of XRP’s rally was tied to Ripple’s legal victory over the U.S. Securities and Exchange Commission and growing optimism about a potential spot XRP ETF — events that drove fresh retail and institutional interest.
Indicators warn of a potential correction
Despite those gains, XRP has already cooled, declining about 16.8% in the past month from its recent year-to-date highs. On-chain analytics provider Nansen shows a stark 80% reduction in XRP balances held by smart-money investors over the last 30 days — a red flag because these sophisticated accounts often reduce exposure ahead of broader market weakness. Retail investors frequently follow smart-money moves, which can amplify downward pressure.
Source: Nansen
Derivatives data corroborates this bearish shift. CoinGlass reports that XRP futures open interest fell from $10.94 billion in July to $7.56 billion at press time, signaling reduced speculative activity. The long/short ratio has slipped below 1, indicating more traders are positioned for downside than upside.
On-chain activity on the XRP Ledger is also decelerating. Dune Analytics shows weekly transactions fell 14.8% to 12.4 million, while weekly active addresses slipped 2.1% to 107,340. This slowdown in network usage is often viewed as weakening demand, feeding into negative price pressure.
Technical indicators add to the warning signs. XRP has dropped below both the 20-day and 50-day moving averages, showing that short-term bearish momentum is dominating. The Relative Strength Index (RSI) has formed a bearish divergence with price action — rising RSI values that fail to confirm higher prices typically warn of buyer exhaustion and profit-taking.
The Aroon Down indicator stands at 92.86% while Aroon Up is at 7.14%, reinforcing the strength of the bearish trend.
Targets and risk levels for XRP
Given the confluence of lower smart-money holdings, falling derivatives activity, subdued on-chain metrics, and bearish technicals, XRP appears vulnerable to further downside. Analysts point to immediate support near $2.70, which acted as a key level during August’s pullback. A decisive break below $2.70 could open the door to a deeper retracement toward approximately $2.30, roughly aligned with the 23.6% Fibonacci retracement level.
What traders should watch next
Key metrics to monitor for Bitcoin include ETF inflows, CoinGlass open interest and trading volume, and CryptoQuant accumulation figures. For XRP, keep an eye on smart-money balances from Nansen, open interest trends, and on-chain activity on the XRP Ledger. Technical confirmations — such as reclaiming moving averages on XRP or a bounce above $120K for Bitcoin supported by rising volume — would be important signals that bullish momentum is returning.
Overall, the market remains in a phase where profit-taking and reduced speculative appetite could keep volatility elevated. Institutional flows and a resurgence in trading volume are likely prerequisites for a sustained bullish resume in both BTC and XRP.
Comments