Bitcoin traded near the $110,000 level in early dealings on Tuesday, amid declining spot and futures trading volumes alongside weaker on-chain activity, signaling mounting selling pressure.
Glassnode, an on-chain analytics firm, said in a report released Monday that Bitcoin’s consolidation around $110,000 is taking place as selling pressure rises across the market. The report noted that Bitcoin’s relative strength index (RSI) dropped from 37.4 to 33.6 last week, placing it in oversold territory and pointing to increasing downside pressure. Glassnode analysts also highlighted that spot trading volumes fell about 9% to $7.7 billion, reflecting weak investor participation and uncertainty in market sentiment.
Analysts added: “Falling volumes during price moves often reflect weak conviction behind the latest trend, which points to uncertainty in the market. Limited participation makes it clear that selling pressure continues to dominate.”
The report also pointed to declining open interest in futures and options last week, reflecting “a shift toward risk-averse behavior” after Bitcoin’s retreat from recent highs.
Glassnode further noted an increase in the influence of short-term holders (STH), with their supply ratio to long-term holders (LTH) rising from 17.0% to 17.7%. This signals a more volatile environment, as short-term holders tend to engage in speculative behavior and reactive decisions.
This uptick in selling pressure comes despite strong buying from corporate holders and U.S.-based exchange-traded funds (ETFs), which reversed nearly $1 billion in outflows to register $396 million in inflows last week.
By contrast, Carmelo Aleman, an analyst at CryptoQuant, said the market has not yet reached a cycle top. He explained that previous Bitcoin bull cycles often included sharp corrections before prices rallied to new highs, making the current pullback healthy. He added that institutional adoption of Bitcoin and growing interest in tokenization could drive prices higher in the coming months.
Aleman cited the network value-to-transactions ratio (NVT), which compares Bitcoin’s market capitalization to on-chain transaction volume, noting it has stayed below 50 since July 7, reflecting robust activity and strong growth potential. He also pointed out that the market value-to-realized value (MVRV) ratio has not yet reached levels typically associated with cycle tops, indicating prices “have not yet entered a blow-off stage.”
Bitcoin was trading at $110,300 in early Asian trading on Tuesday, recovering from a dip toward $107,000.
Four Factors Shaping Bitcoin’s Path in September
Bitcoin closed August with a red monthly candle, its first after four straight months of gains. September carries particular significance as it marks the end of the third quarter and provides key price signals for analysts on expectations for the rest of the year. What are the main factors likely to shape Bitcoin’s trajectory this month?
1. ETF flows could repeat the pattern seen at the start of the year
Analyst Yonsei_dent noted that U.S. Bitcoin ETF flows are closely tied to price action, observing that flows in the past two months resemble early 2025 dynamics. Despite price weakness in January–February 2025, ETF holdings stayed relatively stable, but once they dropped sharply, prices fell in tandem.
The analyst warned that a similar scenario could unfold in September: “We see a similar structure forming in July–August. Bitcoin retreated after setting a new all-time high, but ETF holdings have remained steady — so far. If deeper outflows begin, Bitcoin may face further downside pressure.”
According to SoSoValue, U.S. Bitcoin ETFs posted net outflows of over $126 million on August 29, ending a four-day positive streak and signaling weakening capital inflows.
2. Heavy whale selling versus Ethereum (ETH) accumulation
A second factor is the shifting behavior of major holders. On-chain data showed them selling large amounts of Bitcoin in exchange for Ethereum. Lookonchain reported that one major Bitcoin OG sold 4,000 BTC ($435 million) and bought 96,859 ETH ($433 million) on the last day of August. On September 1, the same investor sold 2,000 BTC ($215 million) and purchased 48,942 ETH ($215 million). In total, this address has accumulated 886,371 ETH worth $4.07 billion.
This market trend, where whales rotate from BTC into ETH, signals a shift in investment outlook and may affect sentiment while prompting similar behavior among retail investors.
3. U.S. demand via the Coinbase Premium Index
This index measures the price gap between the U.S. market (Coinbase) and the global market (Binance). When positive, it reflects stronger U.S. investor demand. The index has dropped from 100 to 11.6 at the start of September. While still in positive territory, the decline points to weaker U.S. buying momentum.
Researchers at XWIN Research Japan said Bitcoin is holding above $100,000 with strong institutional support and a steadily rising long-term valuation floor, viewing current corrections not as weakness but as accumulation opportunities within a broader bullish structure.
4. U.S. money supply (M2) and Fed policy outlook
The fourth and potentially most decisive factor is the Federal Reserve’s interest rate decision. Markets expect a rate cut in September, which could channel liquidity toward risk assets like Bitcoin. Fed Governor Christopher Waller said: “Based on what I know today, I will support a 25-basis-point cut.”
According to Fred data, U.S. M2 money supply has hit a record $22.1 trillion. Historically, periods of rising money supply alongside lower interest rates have fueled powerful Bitcoin rallies. Investor Kyledoops remarked: “$22.1 trillion — a record high for U.S. money supply. The Fed may talk tough on tightening, but the printer hasn’t retired yet… Bitcoin is the hedge the market prepares for, not the one it reacts to.”
Conclusion
September could prove pivotal for Bitcoin, with four key factors at play: ETF flows, whale behavior, U.S. demand, and Fed policy. If positive drivers dominate, the asset may see a strong rebound; but persistent ETF outflows and heavy selling could extend downside pressure.
Monitoring these indicators closely will help traders catch early signals and avoid heavy losses from sudden volatility.
