BTC Plunge Below $120K Sparks Panic—Or Is This the Ultimate Dip Before the 2025 Mega Rally?

Bitcoin's sudden drop below $120K has traders sweating—but the smart money's already licking its chops.

Policy whiplash triggers sell-off

Regulators flip-flop, markets convulse. News at 11. Meanwhile, crypto vets recognize the classic pattern: every brutal correction since 2020 preceded a new ATH.

The institutional playbook

Wall Street's algo-traders just triggered stop-losses for retail investors (again), while quietly accumulating positions through OTC desks. Some things never change—except Bitcoin's price next month.

Blood in the streets? More like discount season for bulls who remember 2023's 40% crashes that became footnotes in the next bull run. Just don't tell the leverage traders.

Short-Term Bitcoin (BTC) Holders Show Strength Amid Volatility

One of the most striking trends has been the resilience of short-term holders (STHs), defined as addresses holding Bitcoin (BTC) for 155 days or less.

Instead of selling into the rally, STHs have shifted toward accumulation, as reflected in the rebound of the STH Spent Output Profit Ratio (SOPR) above the neutral line.

This indicates that coins moved by STHs are being sold at a profit, yet without triggering large-scale profit-taking. Market analysts view this conviction as a stabilizing force that could help absorb selling pressure and support higher prices in the coming weeks.

The derivatives market has also flashed bullish signals. Over the past 24 hours, BTC recorded $24.28 million in short liquidations versus $17.16 million in long liquidations, alongside a 65% surge in trading volume to $149.47 billion.

Options volume soared 128% to $9.43 billion, while the taker buy/sell ratio hit a monthly high of 1.16, a sign that buyers are aggressively absorbing supply.

Positive funding rates further indicate traders’ willingness to pay premiums to hold long positions, suggesting confidence without excessive leverage risk. The NVT Golden Cross, a valuation-to-transaction metric, has dropped sharply, a pattern that has historically preceded strong rallies.

With resistance at $122,190 and support NEAR $115,892, market watchers say a breakout above the former could trigger a retest of $124,457.

Cover image from ChatGPT, BTCUSD chart from