Bitcoin Demand Remains Resilient Amid Price Volatility; $125K BTC Soon?

• The Bitcoin price is nearing a bullish breakout from a bullish continuation pattern called a ‘flag.’
• BTC’s apparent demand shows a positive flag with over 160,000 accumulated since last month.
• OTC BTC reserves have dropped from 550,000 BTC in September 2021 to 140,000 BTC now.
• Accumulator addresses have increased their holding by 50,000 BTC over the past 30 days.

The pioneer cryptocurrency Bitcoin shows a slight uptick of 0.68% during Monday’s U.S. market hours. The buying pressure came as a relief rally in the broader market after a significant sell-off last week. If the pullback recovers the selling pressure in BTC, the coin price could resume its correction trend and head for the $110,000 breakdown. Despite the market fear of a prolonged downturn, the on-chain data highlights intact demand pressure for Bitcoin from new investor accumulators and institutions. Is it a rally to a $125,000 close? 

BTC On-Chain Metrics Signal Strong Demand and Accumulation

Over the past 3 weeks, the Bitcoin price showcased a notable correction from a $123,236 high to a recent low of $114,887, accounting for a 9.18% loss. The selling pressure came as a post-rally pullback for buyers to recoup bullish momentum. However, with the formation of a fresh lower high swing in BTC’s daily chart, the crowd is starting to worry about a prolonged correction trend in price. 

Despite the recent turbulence in Bitcoin price, on-chain data shows that investors’ demand remains strong and supports a potential uptrend in the near term. According to a recent insight shared by CryptoQuant Analyst Darkfost, multiple indicators confirm a substantial appetite for BTC acquisitions in short-term and long-term trends.

One key metric compares new BTC issuance with over 1-year inactive supply. If the resulting ratio is positive, it indicates more coins are being locked up than spent, signaling a next accumulation trend. According to the recent data, the demand remains clearly positive, as around 160,000 BTCs were accumulated over the past 30 days. Thus, the browser investor base is still adding coins to their positions rather than exiting.

Another crucial indicator is the accumulator address, which highlights the addresses that have only acquired BTC without selling any, giving us an insight into both demand and holding conviction. Over the past month, the average Bitcoin accumulated by these addresses has surged roughly 50,000 BTC, showing a steady buying behavior despite the recent price volatility.

Meanwhile, in the over-the-counter (OTC) market—where institutions and large buyers primarily move Bitcoin supply—holdings have recorded a sharp decline. In September 2021, this desk held over 550,000 BTC, which has currently dropped to just 140,000 BTC, a sign that supply from institutions is tightening. Fewer coins on the OTC desk means less sell-side pressure and potentially tighter supply going forward.

Thus, the demand-side metric shows no major red flags for BTC despite the recent price pullback. With the accumulation trend pressure intact at retail and institutional levels, the coin price could hold key support levels and drive a bullish reversal.

BTC Price Near Flag Pattern Breakout

The four-hour chart of Bitcoin price shows the formation of a bullish continuation pattern called a ‘flag.’ The chart setup is commonly spotted in an established uptrend for buyers to recapture the bullish momentum.

Currently trading at $115,244, the BTC price is less than 2% from challenging the upper boundary of the pattern. A potential breakout will signal the continuation of the prevailing recovery and bolster the asset for a $123,236 high and chase $125,000.

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