Bitcoin price changes course: On-chain distribution and selling pressure accelerate correction towards $84K

On-chain indicators confirm a new distribution phase that is transforming the Bitcoin landscape. On Tuesday, BTC was trading around $84,180 after a significant drop from the $97,000 recently reached, a correction that reflects not only large whale activity but also a change in long-term investor behavior. This movement marks a critical inflection point that market participants need to understand clearly.

Change in Price Flow: Whales Deposit En Masse While Momentum Declines

The collapse in Bitcoin’s price has deep roots in the activity of major holders. According to CryptoQuant’s Whale Screener, whales deposited over $400 million in BTC on spot exchanges on January 20, an event that historically precedes a mass sell-off or increased liquidity in the market.

“This marks the second major deposit spike in a short period,” said Amr Taha, CryptoQuant analyst. A similar $500 million influx occurred just five days earlier, on January 15. These deposits are not random movements: “Large BTC deposits on spot exchanges generally indicate high selling pressure,” Taha explained, adding that such flows often precede short-term price weakness.

The shift in price direction does not surprise analysts. When whales start moving their positions to trading platforms, the market should brace for increased volatility.

Accelerated Distribution Among Long-Term Holders Complicates the Outlook

Beyond whales, long-term holders (LTH) are intensifying their distribution, an equally concerning factor for bulls. Data from Glassnode reveal that since early January, the net position of LTH has remained in negative territory, with approximately 68,650 BTC sold in the last 30 days.

This is significant because long-term holders usually act as market stabilizers. However, they are now taking profits during the price strength, particularly after the rebound toward $97,000. The behavior has changed: instead of accumulating positions during recoveries, they are securing gains, reinforcing the current corrective structure.

Not all is pessimistic, however. Analysts observed similar LTH distribution patterns in mid-December 2025, just before Bitcoin recovered from $84,000 to $94,700 in early January. This historical precedent suggests that the current correction could present opportunities when key levels act as support.

On-Chain Signals Warn of New Selling Pressure

On-chain indicators tell a clear story: the market is under pressure. With BTC currently trading near $84,180, key technical levels demand close attention.

Critical Support Points:

• $87,300: 100-week simple moving average (SMA), an important technical defense line
• $84,000–$86,000: Zone of high historical demand and strong psychological support
• $80,500: November local low that could act as a last refuge in deep decline scenarios

A sustained break below the 50-day SMA (around $90,000) and the 20-day exponential moving average (about $92,000) opens the door for deeper tests at lower levels.

Key Technical Levels That Could Shift the Bearish Outlook

Michael van de Poppe, founder of MN Capital, has noted that Bitcoin is trading again within a broader range as geopolitical risks intensify. “Bitcoin is breaking down into the range as geopolitics worsen,” van de Poppe wrote on X, indicating momentum indicators are approaching oversold levels.

His analysis suggests a possible short-term relief bounce between $84,000 and $86,000, though without confirming a genuine trend reversal. “The RSI is as oversold as during the collapse toward $80,000,” van de Poppe explained. “We might see a rebound, not a reversal,” he clarified, an important distinction for traders looking to differentiate between technical recoveries and structural changes.

Risk Analysis: Will Bitcoin Maintain the $84K Level?

For bullish investors, recovering and holding the $90,000 level remains critical to restoring overall market confidence. However, as whale inflows continue to exchanges and long-term holder distribution persists, Bitcoin remains vulnerable to new downward pressures.

On-chain data offer clues about the near-term direction, but macroeconomic uncertainty and geopolitical tensions add layers of additional risk to highly volatile assets. Bitcoin’s price will continue to fluctuate until these fundamental indicators change: when whales stop depositing on exchanges and LTHs stabilize their distributions, a new recovery opportunity could emerge. Meanwhile, the $84,000 to $86,000 zone remains the most important psychological support to watch, according to Cointelegraph reports.

#BTC #ETH