Bitcoin Falls to $112K as Short-Term Holders Near Breakeven
On-chain analyst Murphy reports that Bitcoin fell to $112,000 ahead of Federal Reserve Chair Jerome Powell’s speech. This price level mirrors the average cost basis for coins held under three months, marking a critical threshold for short-term holders. These investors, described as the most active and sentiment-sensitive segment, face breakeven risk: a drop below this line turns unrealized gains into losses, heightening psychological pressure. However, their proximity to breakeven may deter selling, providing a floor and containing immediate downside. As a result, market sentiment may skew toward anxiety but resist mass capitulation, setting the tone for Bitcoin trading around the upcoming Fed announcement.
Neutral
We classify the impact as neutral because the dip to the $112,000 level aligns with the average cost basis for short-term holders, creating a psychological support zone. Historically, when on-chain data shows coins nearing breakeven, selling pressure often pauses as investors hesitate to realize small losses. Although sentiment may turn anxious ahead of a major Fed speech, widespread capitulation is unlikely. In the short term, this sets a trading range around current levels, with volatility tied to Powell’s remarks. Over the longer term, if the stimulus outlook shifts materially, Bitcoin could resume stronger directional moves. Until then, the market may trade cautiously without a clear bullish or bearish bias.