Bitcoin ( BTC ) challenges the 110,000 USD resistance level and sets a new high: market sentiment and capital flow analysis

Bitcoin's Historic Breakthrough and Retracement

A month ago, Bitcoin (BTC) reached a new high with a highest monthly closing price of $110,247, which quickly turned into a strong resistance level. However, entering July, Bitcoin challenged this key price range again and set a new all-time high.

As of July 10, when this article was published, Gate market shows that BTC is currently priced at 111,269.7 USD, with a 24-hour increase of 2.33%.

Unlike the previous rebound driven by four strong green candles, this rebound has gradually progressed from a "pullback" at $98K over the past two weeks. This change indicates a shift in market structure. Now, investors' patience has reached an unprecedented high.

In this market atmosphere, will FOMO trigger the next wave of breakthroughs, or will greed lead to another premature peak?

Market Sentiment: Testing the $110K Key Wall

According to Glassnode, on July 4, about 80,000 bitcoins were transferred from addresses that had been dormant five years ago in the $108K price range. This activity appears to coincide with a surge in Bitcoin's realized profits to a new annual high of $9.2 billion. Still, despite such massive profit-taking, Bitcoin fell just 1.41% on the day.

This resilience is no coincidence. In July alone, the inflow of funds into Bitcoin ETFs exceeded $1.3 billion, easily absorbing selling pressure. Nevertheless, market sentiment did not become overheated. Even when it pushed to $110K last month, the Fear & Greed Index only reached 64, far below the explosive sentiment typical of market tops.

BTC Strategic Layout of Smart Funds

On the chart, the Bitcoin pullback has led to differing views in the market regarding its future trend. Some analysts believe that the recent transfer of 80,000 Bitcoins is a carefully orchestrated smart money shakeout, aimed at creating volatility to trigger retail investors to sell and re-enter at lower price levels.

The data seems to support this view. During the last pullback of Bitcoin around the $110K resistance level, the number of large whale addresses experienced negative growth, with a decrease of 26 addresses in just 10 days. This decline perfectly synchronized with the drop in Bitcoin price to $98K.

The next reaction is a classic strategic accumulation—large whales are re-entering the market, and the number of addresses has risen to 2,008. Typically, in historical cycles, this accumulation often aligns with the strategy of smart money to "buy when there is fear and sell when there is greed."

Bitcoin's Next Step: Breakthrough or Trap?

If this trend continues, it could lead to a liquidity flush. In other words, smart money may execute a tactical shakeout at the resistance wall of $110K-$111K, paving the way for Bitcoin's sustained breakout.

Summary

Bitcoin is currently challenging the key $110K resistance level. Although market sentiment is not overly inflated, it also indicates some buying pressure. Smart money may be making larger strategic moves by manipulating market volatility. Investors need to be aware of potential liquidity traps and whether the market will break through this key resistance level to enter a new upward cycle.