Bitcoin (BTC) fell below $113,000 during mid-week trading as traders took profits, triggering a broader sell-off across the cryptocurrency market. The decline comes after the leading digital asset closed under a key upward trendline formed since early April and slipped beneath the 50-day Exponential Moving Average (EMA) of $114,903.
The move marked Bitcoin’s first monthly loss since March, halting four consecutive months of gains. BTC had rallied 66% from its 2025 low to its recent peak but faced heavy resistance near $125,000 late last week, a level that signaled weakening momentum.
Macroeconomic Pressures and Liquidations
Optimism around aggressive U.S. interest rate cuts cooled after a stronger-than-expected Producer Price Index (PPI) inflation report, dampening risk appetite across both traditional and crypto markets. This shift contributed to a more pronounced pullback, with Bitcoin dropping to an overnight low of $112,580 — down 9.5% from its record high of $124,517 reached on August 14.
The correction was intensified by a sell-off in overpriced technology stocks, closely correlated with Bitcoin, alongside large-scale liquidations. Data showed that $500 million worth of Bitcoin positions were liquidated in just one day, fueling concerns that the market may test critical support near $112,000.
Ether (ETH) also slid into its support zone between $4,100 and $4,000 amid the downturn.
Technical Indicators Show Bearish Momentum
On the daily chart, Bitcoin’s Relative Strength Index (RSI) dropped to 41, signaling bearish momentum. The Moving Average Convergence Divergence (MACD) also confirmed a bearish crossover, suggesting the potential for continued downside pressure.
Despite central bank gold purchases driving bullion to historic highs, Bitcoin remains tied to riskier assets like U.S. tech stocks, undermining its role as “digital gold.” Traders are now closely watching the U.S. Federal Reserve’s September meeting, which could be pivotal for market direction.
Institutional Activity and Market Outlook
So far in 2025, Bitcoin has risen from a February low of $81,975 to current levels around $113K, with institutional distribution observed near cycle highs. Analysts say the present decline is a natural correction following a 39% gain from August lows rather than a fundamental breakdown.
Bitcoin still dominates 58% of the crypto market, though that figure has slipped slightly as altcoins gain ground during institutional selling phases. Its market capitalization currently stands at $2.26 trillion, while daily trading volume has cooled to $66 billion, signaling consolidation rather than panic selling.
With Bitcoin sitting just 8.55% below its all-time high of $124,457, traders believe the asset is entering a key consolidation zone where institutions often take profits. The stakes are high as the market tests support levels, and all eyes remain on upcoming macroeconomic developments that could determine Bitcoin’s next move.
