Bitcoin Bounces into Resistance: The $69K Short-Term Holder Cost Basis Becomes a Key Decision Point

Original Author: Glassnode

Original Translation: AididiaoJP, Foresight News

Summary

• Escalation in Iran’s situation triggered a surge in oil prices, while stock markets performed flat or declined. Bitcoin, however, absorbed this shock and outperformed both major stock indices for a second consecutive week.
• For the first time in five months, core inflation data showed a downward trend, arriving just one week before the FOMC meeting. Policy interest rates remain above inflation, maintaining a restrictive stance.
• The 10-year US Treasury yield returned to a high range, while the US dollar remained relatively stable. The "ceiling" jointly built by yields and the dollar has not yet been lifted.
• Price has entered a decision zone: the upper boundary is the short-term holder cost basis around $69,000, while the lower boundary is the market's heaviest demand support zone.
• Supply near current prices is tilting toward the support side. Exchange net inflows continue to weaken, and the profit-taking pressure needed to stall a rebound has not yet accumulated.
• Accumulation behavior has narrowed to a high-conviction group holding 1,000-10,000 BTC. Breadth remains the missing piece on the chain.
• On the off-chain front, signals tracked in this report have finally materialized: ETF flows have turned positive, price has surpassed the max pain level, and hedging positions have dropped to multi-month lows.
• Altcoins have weakened against Bitcoin once again, with capital flowing to the leading asset. The market compass reading also indicates: recovery is underway, but still within a low risk appetite range.

Macro Insight

Weathering the Oil Shock

This week's macro test came from the oil market. WTI crude oil surged due to the escalation in Iran's situation, a type of external shock that typically drags down risk assets. However, the equity market reacted mildly: the S&P 500 closed the week lower, while European stock markets traded sideways. Bitcoin continued its upward trend under the same shock, outperforming both major stock indices for the second consecutive week. A market that can still rise on bad news suggests that marginal selling pressure has largely been exhausted—this resilience itself is a signal.

Inflation Finally Bends

Core inflation recorded a decline for the first time in five months, reaching a reading closest to the target level since the post-2022 highs. Although a single data point does not constitute a trend, its timing is impeccable: when the FOMC meets next week, the federal funds rate will still be more than 100 basis points above core inflation.

This gap reflects the restrictive policy stance and also leaves room for the Fed to maneuver. If a signal to cut rates is given, it would lift one of the macro brakes tracked throughout the year by this report. If the Fed remains silent, the market will have to continue relying on crypto-native momentum to move forward.

Yields Push Higher, Dollar Takes a Break

The bond market did not cooperate. The 10-year US Treasury yield returned to near its recent highs, continuing to pressure all risk assets. Meanwhile, the US dollar remained relatively mild, well below its winter highs.

The ceiling for an upward trend in this cycle is clear: a 10-year yield above 4.45% and a US dollar index above 99. The dollar side is close to a breakout, but the yield side is not. Both breaking down simultaneously remains a key valve for macro release.

On-Chain Insight

Entering the Decision Zone

Since the rebound from the late June low, the distribution of supply around the price has become the core narrative. The upper boundary is the short-term holder cost basis around $69,000—the breakeven line for buyers over the past five months. The lower boundary is the heaviest demand support zone on the chart, accounting for about one-tenth of the total supply, concentrated around $63,000 (the price at which the median coin last changed hands). Further down, the realized price floor lies far below.

The asymmetry of the first wall is well known to the market: when approaching from below in a downtrend, the breakeven line of recent buyers often becomes a selling pressure zone, as the holders most eager to sell are about to break even. Once breached to the upside, an "air pocket" forms above until the $84,000 level. If successfully reclaimed, resistance in this zone is thin, allowing for rapid revaluation. If it fails, the support zone below will face a new round of testing.

Support Converging Towards the Test Zone

Supply near the current price is aligning. Data on the distance-weighted cost basis shows that the chips near the price level are divided into support below the current price and resistance above. The share of support has just surpassed the share of resistance, flipping the pattern dominated by resistance since spring.

A stalled rebound still requires selling pressure, and the fuel is not yet loaded. The classic trigger signal is the proportion of profitable short-term holder supply breaking above 54%—enough recent buyers breaking even to create a wave of selling. This indicator is currently far from the trigger point, and the short-term holder SOPR remains stable near the breakeven line rather than flipping downward. Recent buyers are neither in a frenzy nor have they exited.

Selling Pressure Gradually Fading

The exchange "revolving door" has slowed down. During the market breakdown in early June, the net position change on exchanges showed a large net inflow—potential selling pressure arriving at the trading venue. This inflow has weakened for several consecutive weeks and is now only a fraction of its peak.

An inflow that weakens but does not transition into a dominant outflow is a neutral pattern: demand is absorbing the incoming volume, but the structural withdrawal trend typical of a healthy market has not yet returned. A confirming signal to watch for is sustained net outflows—a chain-based follow-up that the ETF channel has just begun to provide.

Conviction Concentrated but Lacks Breadth

The June rebound was driven by broad accumulation: the accumulation trend score covered all wallet groups at the low point. The past two weeks have been different, as buying narrowed to the 1,000-10,000 BTC cohort—historically, these wallets often lead durable turning points—while mid-tier groups shifted back to distribution.

Concentrated accumulation has pros and cons. The firm conviction of large, patient wallets has led recoveries many times before. However, a market structure supported by only a single group is also thinner than one with participation from all groups. The return of breadth during the next upward move will be the key differentiator between a squeeze and a trend.

Off-Chain Insight

Redemption Streak Ends

For weeks, every improvement came with the same caveat: optimism in derivatives, but continued bleeding from the ETF channel. US spot Bitcoin ETF flows have turned net positive, marking the first sustained net buying since the redemption wave in June ended.

Last week's report pointed out that institutions had stopped fleeing but had not yet started buying. The current flip is still early and moderate in scale, but it transforms a rebound driven purely by derivatives into one backed by spot buying. Persistence, rather than scale, is the key factor to watch.

Above Max Pain

Max pain—the price at which the most option positions expire worthless—has acted as overhead resistance throughout the spring. Last week, Bitcoin approached from below and has now surpassed this aggregate level, far above its position at the February low.

Historically, reclaiming max pain is often followed by a shift to a more favorable options market structure, although the transition is usually gradual. If price maintains above this level during the upcoming option cycle, dealer hedging flows will act to dampen rather than chase volatility, turning the "pain point" from a ceiling into an anchor.

Hedging Unwound, Shorts Squeezed

Since the June low, each report has tracked the same quiet process: traders closing short positions and allowing downside protection to expire. The market has now loudly confirmed this trend. The one-week 25-delta skew has collapsed to multi-month lows, with the front end of the curve shedding downside protection the fastest, and the one-month tenor following suit.

The put/call composite indicator confirms this trend: the put/call ratio for open options interest has dropped to its lowest level of the year, and the volume ratio has halved compared to the June hedging peak. The perpetual contract funding rate has been below the neutral line every day for the past month.

This optimism stems from the unwinding of hedging positions rather than the accumulation of new leverage. Squeezes built on this foundation typically experience more moderate pullbacks than those driven by a surge in funding rates.

Altcoins Bleed, Bitcoin Leads

Beneath the surface, capital continues to favor the leading asset. Altcoins across all tiers have been weakening against BTC for years. This long-term downtrend flattened in the spring, forming the most constructive altcoin bottom of this bear market. Last week, this gradual decline quietly resumed: as Bitcoin moved higher, smaller-cap coins conceded further against BTC.

This is a healthy version of rotation. Bitcoin leading first concentrates capital in the most liquid asset before spilling out to others. Premature altcoin leadership is typically a sign of bubbling. A held bottom and Bitcoin leading the way are the right sequence for a durable recovery.

Conclusion

Until proven otherwise, this is still a bear market rally, and the proving ground is clear. The squeeze has done everything a squeeze can do: hedging unwound, shorts covered, funding rates calm, and ETFs turned from a drag into a support. But it has yet to clear the overhead resistance. This week, Bitcoin remains below the $69,000 short-term holder cost basis. Above lies the air pocket and the $84,000 level; below is the $63,000 demand support zone and the still-forming support structure.

If price decisively reclaims $69K with sustained spot inflows, the air pocket above will open up. If it meets resistance and exchange inflows reappear, the market will fall back to test the support zone.