- Spot demand for BTC is strengthening as dense accumulation signals lasting support.
- Coinbase and Binance flows indicate liquidity shifts that support upward momentum.
- Bitcoin must clear resistance at $113,650 to confirm a breakout; otherwise it risks retesting $100,000.
The Bitcoin (BTC) spot market is showing signs of a possible recovery, backed by on-chain data, exchange flows, and technical indicators that point to growing buyer conviction.
Analysts suggest this recent activity could set the stage for a bullish breakout, though caution remains given Bitcoin’s historically weak seasonality in September.
On-chain data highlights buyer conviction
Glassnode data reveals that the cost-basis distribution for Bitcoin (CBD) differs markedly from that of Ether (ETH).
The CBD, which tracks where significant supply was accumulated or distributed, shows spot activity for Bitcoin as far denser compared with ETH.
Transactions cluster tightly around recent price levels, indicating buyers are accumulating with conviction.
Historically, that kind of concentrated clustering in Bitcoin has provided more durable support than futures-driven dynamics.
This suggests the current market structure may be more resilient, with spot demand forming a foundation for potential upside.
The trend is complemented by a modest uptick in spending by long-term holders (LTH) in recent weeks.
The 14-day simple moving average (SMA) of LTH spending has risen gradually, indicating some profit-taking.
Activity, however, remains within cycle norms and far below the peaks seen in October and November 2024, implying selling is measured rather than aggressive.
Exchange flows point to liquidity shifts
Exchange flows also reinforce the recovery narrative.
A quick snapshot from CryptoQuant highlighted that Coinbase recorded consistent spikes in net inflows between August 25 and 31, after a period in which its 30-day net flow SMA hit the lowest level since early 2023.
Historically, sharp reversals from multi-year lows often signal regime changes in liquidity—either due to settlement reshuffling or increased preparations for higher activity.
At the same time, Binance saw its 30-day net flow SMA rise to the highest level since July 2024, with peaks on July 25 and August 25.
Those levels previously coincided with reaccumulation phases that preceded new local highs.
The concurrent trough on Coinbase and peak on Binance suggests meaningful reserve redistribution, potentially laying the groundwork for upward BTC momentum.
Focus on key technical breakout levels
Price action further supports the recovery case.
Bitcoin dipped to $107,300 on Monday, aligning closely with its short-term realized price before sharply rebounding from that low.
By Tuesday’s New York session, BTC had cleared Monday’s high of $109,900, signaling renewed resilience.
On shorter timeframes such as the 15-minute and 1-hour charts, Bitcoin recorded bullish structure breaks.
On the 4-hour chart, the relative strength index (RSI) climbed back above 50, bolstering rising bullish momentum.
For the recovery to hold, Bitcoin must decisively overcome resistance between $112,500 and $113,650.
A daily close above $113,650 would confirm a bullish breakout and invalidate the descending trendline that has capped price action over the past two weeks.
Such a move could unlock liquidity targets at $116,300, $117,500, and potentially $119,500.
However, if BTC fails to sustain momentum above $113,650, downside risks remain elevated.
An unsuccessful breakout could expose the cryptocurrency to declines toward the order block between $105,000 and $100,000.