Bitcoin stuck between sellers and liquidations: Will BTC struggle to go higher?

Key Takeaways

Liquidity collapse and ETF instability have weakened Bitcoin’s structural support and price momentum. Taker sell dominance and liquidation clusters near $117K add downside pressure.

Bitcoin’s [BTC] structural momentum remained fragile as the market struggled to recover from July’s liquidity collapse and ETF instability.

Although Bitcoin was trading around $114.5K, sell-side liquidity has drastically shrunk while ETF demand remains volatile and unreliable. 

Rather than stabilizing the market, institutional flows have been inconsistent—producing sharp inflows followed by withdrawals.

This erratic demand failed to support Bitcoin during critical breakdowns, exposing it to heightened price sensitivity. 

As a result, the market has entered a “thin” phase where even modest sell pressure triggers steep corrections, casting doubt on a near-term bullish breakout.

Source: CryptoQuant

Bitcoin: Negative netflows point to…

According to on-chain exchange data, Bitcoin continued to experience net outflows, signaling reduced sell pressure. 

On the 4th of August, over $3.67 million in BTC left exchanges, reflecting cautious optimism from long-term holders. 

However, this outflow was modest compared to prior months when daily withdrawals often exceeded hundreds of millions. 

Therefore, while consistent outflows suggest investors are holding rather than selling, the reduced scale of these movements weakens their impact on price momentum. 

Bitcoin needs renewed inflow strength—either through accumulation or spot buying—to convert this trend into meaningful upside.

Source: CoinGlass

What’s behind Bitcoin’s bearish bias?

The Futures market revealed growing bearish pressure as taker sell volume continued to dominate.

The 90-day CVD (Cumulative Volume Delta) highlighted that market participants were increasingly executing sell orders rather than buying dips. 

This trend reflects rising short-term pessimism, especially as price tests key technical levels without sustained bullish conviction.

In environments where liquidity is thin and ETF flows are unreliable, dominant taker sell activity becomes more influential. 

Therefore, the persistence of this trend implies that speculative sentiment remains skewed toward downside positioning.

Source: CryptoQuant

Can Bitcoin defend its trendline?

Bitcoin’s price action has bounced off the ascending trendline support around $113K, temporarily halting the recent decline. 

It now faces an overhead resistance cluster between $117K and $122K, which coincides with the upper Bollinger Band and a previously rejected price zone. 

Although the RSI sat at a neutral 55 at press time, suggesting room for movement in either direction, the current rally lacked volume and conviction. 

For Bitcoin to reclaim momentum, it must flip $117K into support with strong daily closes and increased spot buying. Otherwise, the bounce risks becoming another lower high.

Source: TradingView

The $115K–$117K liquidation clusters 

At press time, the 24-hour Binance BTC/USDT liquidation heatmap showed heavy liquidation density between $115K and $117K—precisely where Bitcoin was trading. 

These zones often act as magnets for price action but can also suppress upward movement when liquidation risk mounts.

In contrast, the lower bands of the heatmap show far fewer liquidations, implying limited cushion in case of a breakdown. 

Therefore, Bitcoin faces a tight squeeze between growing sell-side pressure and limited downside protection, making the next move highly reactive to leverage dynamics.

Source: CoinGlass

In summary, Bitcoin’s price momentum remains under pressure as weak liquidity, inconsistent ETF flows, and dominant Futures selling shape a fragile landscape. 

To reclaim bullish strength, the market must overcome dense liquidation zones and reclaim $117K with conviction. Until then, upward continuation will likely face stiff resistance.