Bitcoin Drop to $108K Caused by Short Term Profit Taking Not Investor Panic

Analysis of Binance data shows that Bitcoin’s drop to around $108,000 in August wasn’t caused by long-term investors dumping their holdings. Instead, it was mainly short-term traders selling quickly to secure profits whenever the price climbed.

Good to Know

• Bitcoin fell to $108,000 in August, mainly due to short-term traders cashing out at resistance levels.
• Long-term holders barely sold, showing confidence in Bitcoin’s long-term trend.
• The $124,000 price barrier triggered frustration among traders, leading to heavier selling pressure.

CryptoQuant found that each time Bitcoin’s price moved upward in August, short-term traders sold rapidly to lock in gains. This behavior, known as profit-taking, created selling pressure strong enough to keep Bitcoin below $120,000 and eventually push it down to $108,000.

Unlike speculators, long-term investors stayed calm. Their selling levels were low and stable, which shows they were not panicking or rushing to exit the market. That stability is often seen as a positive sign for the overall trend.

The Role of Resistance at $124K

A big factor was the failure to break above $124,000. In trading, this kind of level is called resistance — a price point where many sellers step in. When Bitcoin couldn’t pass it, short-term traders rushed to sell, worried that their recent profits might disappear.

A Healthy Reset, Not a Crash

CryptoQuant concluded that the decline looks more like a healthy correction rather than the start of a bigger downturn. Corrections are normal pauses in an upward trend, and the fact that long-term holders didn’t sell heavily suggests strong ongoing confidence in Bitcoin.