Bitcoin News Today: STH Cost Basis Sparks 7% Correction Risk – Will $110K Support Hold?
Bitcoin’s price action is under intense scrutiny as short-term holders (STHs) play a pivotal role in shaping its near-term trajectory. With a potential 7% correction looming, traders are eyeing critical support at $110K and resistance at $140K. Here’s what you need to know.
Bitcoin News: STH Cost Basis and Its Impact
Glassnode’s latest analysis reveals that Bitcoin’s short-term holders—those holding BTC for up to 155 days—are driving key price dynamics. Their collective cost basis acts as a support level during bull markets, but gaps in trading activity could trigger a correction.
- Support Zone: $110K–$115K, where limited trading activity leaves room for a pullback.
- Resistance Zone: $140K, where profit-taking by STHs could cap upside momentum.
- Key Metric: The +2σ band in cost basis distribution suggests heightened selling pressure at $140K.
Bitcoin Correction Risk: What Traders Should Watch
A 7% dip to $110K is possible if Bitcoin fills the “cost basis gap” identified by Glassnode. This level could attract buying interest, but a break below may signal deeper downside.
| Scenario | Price Level | Likely Outcome |
|---|---|---|
| Bullish Breakout | $140K+ | Profit-taking, limited gains |
| Bearish Correction | $110K | Buying opportunity, potential rebound |
Bitcoin Support and Resistance: The Road Ahead
The $110K support level is critical for maintaining bullish momentum. If it holds, Bitcoin could retest $140K. However, a failure to sustain above $110K may lead to further downside.
Conclusion: Navigating Bitcoin’s Volatility
Bitcoin’s near-term price action hinges on STH behavior. Traders should monitor $110K for support and $140K for resistance, adjusting strategies accordingly. Stay vigilant—the next move could be decisive.
Frequently Asked Questions (FAQs)
Q: What is STH cost basis?
A: It represents the average purchase price of Bitcoin held by short-term investors (up to 155 days), influencing support and resistance levels.
Q: Why is $110K a key support level?
A: Glassnode identifies a “gap” in trading activity here, making it a likely target for price corrections.
Q: What happens if Bitcoin breaks $140K?
A: Profit-taking by STHs could intensify, potentially limiting further gains.
Q: How reliable is Glassnode’s analysis?
A: While not infallible, their on-chain metrics provide valuable insights into market sentiment and price trends.
