Key takeaways:
Bitcoin suffers its steepest weekly decline since March, slipping under $110,000.
Over $15 billion in leveraged positions were flushed out, signaling a reset in risk appetite.
October seasonality has historically delivered strong Bitcoin gains.
Bitcoin ( BTC ) is enduring its sharpest weekly decline since March 2025, with prices dropping over 5% and sliding below the $110,000 mark. The correction has hit short-term traders hard, as more than 60,000 BTC were sent to exchanges at a loss this week.
This marked the first time in five months that Bitcoin fell under the short-term holder (STH) cost basis of $109,700, a level that could signal stress among speculative market participants.
At the same time, the drawdown has exposed the scale of risk-on positioning across the crypto market. Crypto analyst Maartunn noted that $11.8 billion in leveraged altcoin bets and $3.2 billion in speculative Bitcoin positions have been flushed out, pointing to a significant reset in risk appetite. The analyst argued that this cleanup could help reduce market fragility, paving the way for a more balanced recovery.
Market sentiment has also shifted sharply. Bitcoin researcher Axel Adler Jr. noted that the Advanced Sentiment Index plunged from 86% (extremely bullish) to just 15% (bearish) in two weeks. While zones below 20% often trigger technical bounces, Adler Jr. stressed that sustained recovery will require sentiment to climb back above 40%–45% with the 30-day moving average trending higher.
Long-term holders (LTH) appeared stable as distribution remained subdued at $76.7 million per week. Meanwhile, only 1.5% of STH are at a loss, with most still in profit, limiting the risk of forced liquidations.
However, Adler Jr. cautioned that capitulation risks would rise if STH losses exceeded 10% and market value dipped below the realized value.
Related: Bitcoin sees most fear since $83K as analysis eyes ‘turning point’
October seasonality to the rescue?
While the short-term picture looked fragile, Bitcoin’s current path is not far off from historical seasonality. September typically delivers negative returns, averaging −3.43%, and BTC has so far managed to remain slightly positive at +0.68%.
Bitcoin network economist Timothy Peterson suggested the latest pullback fits neatly into past patterns. “This is the September capitulation,” Peterson said , “On my daily tracking sheet, Sept. 25 is the lowest median value. Bitcoin finishes the next five days higher 80% of the time, with an average gain of 1.7%.”
Peterson also highlighted that 60% of Bitcoin’s annual performance occurs after Oct. 3, with a high probability of gains extending into June. The economist even projected a 50% chance of Bitcoin hitting $200,000 by mid-2026, citing seasonality-driven bull phases between October and June.
History also lends weight to optimism. Since 2019, Bitcoin has closed October in the green every year, averaging returns of 21.89%. Even during the bear market of 2022, BTC posted a 5.53% gain that month. If the pattern holds, the current wave of pain may soon give way to renewed upside as the market enters its most seasonally bullish stretch.
Related: Bitcoin crumbles below $109K, but data shows buyers stepping in
