Bitcoin is trading just above the $112,000 level after breaking down from a consolidation range that held for over two weeks. The sharp decline sparked concerns among investors, particularly among Short-Term Holders (STH), who now face the difficult choice of realizing losses or holding underwater positions. However, top analyst Darkfost shared key insights suggesting that Bitcoin’s underlying demand remains robust, despite the price volatility.
According to Darkfost, the Apparent Demand metric — comparing new BTC issuance to over one-year inactive supply — indicates that the market is still absorbing supply effectively. The ratio has stayed in positive territory, signaling that demand continues to outpace new issuance. Over the past 30 days, approximately 160,000 BTC have been accumulated, highlighting strong buying behavior even as prices corrected.
While sentiment among STH has weakened due to the recent drawdown, long-term accumulation trends suggest the broader market structure remains healthy. Investors with longer time horizons are continuing to add to their positions, reflecting confidence in Bitcoin’s long-term prospects. As BTC stabilizes around $112K, market participants are closely watching for a potential reversal or a deeper correction, with demand-side indicators offering a more optimistic outlook for the weeks ahead.
Darkfost also highlighted critical insights regarding Demand from Accumulator Addresses, a metric that tracks wallets that have only acquired Bitcoin without any history of selling. This indicator provides a clear view into both the demand dynamics and the holding conviction of long-term investors.
Over the past month, the average BTC accumulated by these addresses has grown by approximately 50,000 BTC, showcasing a consistent and determined buying trend, despite recent price corrections. Such behavior underscores the confidence of long-term holders who are taking advantage of market dips to strengthen their positions.
On a broader horizon, BTC held on OTC Desks reflects a more strategic and long-term demand pattern. Unlike exchange-based activity, OTC transactions are less visible in immediate price action but offer a window into the intentions of institutional players.
Since September 2021, the supply of BTC on OTC desks has dropped sharply, from around 550,000 BTC to just 145,000 BTC today. This significant decline indicates that large-scale buyers are consistently removing Bitcoin from OTC circulation, reducing the available supply for future institutional entrants.
Whether examining short-term accumulation or long-term OTC trends, the overall demand-side picture remains notably positive. Despite recent volatility and a wave of short-term profit-taking, there are no major signs of structural weakness from demand-side indicators.
Bitcoin is currently trading at $114,476, showing signs of stabilization after a sharp drop to $111,971 earlier this week. The chart shows BTC still hovering below the crucial $115,724 resistance, which aligns with the lower boundary of the previous consolidation range. The 50-day SMA sits at $100,228, providing a solid technical base, while the 100-day SMA at $95,433 remains a key medium-term support zone. The 200-day SMA is rising steadily at $77,282, confirming the long-term bullish trend.
Despite the recent volatility, Bitcoin’s price structure still suggests a bullish outlook as long as BTC maintains higher lows above the $110K level. However, the $122,077 resistance remains a critical barrier. Breaking above this level would signal a strong bullish continuation towards new highs.
Volume activity has been decreasing during this retracement, which is a positive sign, indicating that selling pressure is not overwhelming. If BTC can reclaim the $115,724 zone in the coming sessions, it would increase the probability of another breakout attempt towards $122K.
Featured image from Dall-E, chart from TradingView
