Key Takeaways
Is Bitcoin nearing a cycle top?
Profit-taking remains 50% below past peaks, HODLer conviction is strong, and Bitcoin’s on-chain data shows no signs of capitulation.
What’s driving the latest dip?
A $5 billion drop in Open Interest signals a healthy reset, as BTC dominance and ETF inflows keep momentum BTC-led.
The market has officially drifted into neutral territory. With the Season Index at 55, at press time, there’s no clear dominance. Neither altcoins nor Bitcoin [BTC] are in season. At the same time, the Fear & Greed Index mirrors this calm.
In this context, BTC’s 2.4% pullback off $125k all-time high mirrors past cycle tops. Risk appetite is low, greed muted, highlighting weak follow-through, and setting up a classic long squeeze scenario.
Supporting this, BTC’s Open Interest (OI) has dropped nearly $5 billion from its $94 billion ATH, with $200 million in long positions already liquidated. Does this setup suggest Bitcoin might have reached a near-term top?
Holder selling trails, diverging from past Bitcoin tops
Bitcoin’s at a point where patience is key for any directional bets.
CryptoQuant’s latest report shows some interesting divergences. While macro sentiment is light on “dip” buying, BTC supply is tight and HODLer conviction remains strong, something we don’t usually see at cycle tops.
Backing this, over the past 30 days, net realized profits hit 0.26 million BTC ($30 billion), about half of July’s 0.53 million BTC ($63 billion) peak and well below March and December 2024 highs of $78 billion-$99 billion.
Source: CryptoQuant
In short, holders aren’t selling, with profit-taking 50% below past peaks.
Meanwhile, selling from Bitcoin “OGs” remains light as well. BTC > 10 years spent in the last 30 days totals 5k (half of the levels seen at previous March and December 2024 peaks and 29% below May 2025 highs).
Historically, price tops coincide with much higher spending from these LTHs, reinforcing that the current rally still has room to run. Against this backdrop, is this dip just a “healthy reset” before Bitcoin season fires up?
Another key divergence emerging in BTC dominance
The Season Index is officially nudging the market toward Bitcoin season.
Notably, it dropped 13 points in under 72 hours, tracking BTC’s $125k top, marking a key divergence from previous cycle tops. Back then, Bitcoin dominance (BTC.D) broke support as capital rotated into high-beta alts.
This time, the flow remains BTC-led, with BTC.D up 1% and holding around 59%. In short, even with BTC pulling 2% off its ATH, money’s still rotating in, backed by $440 million hitting BTC ETFs on the 8th of October.
Source: TradingView (BTC.D)
Put simply, Bitcoin hasn’t flipped risk-off yet.
Profit-taking’s controlled, no capitulation showing on-chain, alts are quiet, and institutional spot flows are still tightening supply, keeping momentum BTC-led. In short, all signs suggest BTC’s top is still out of sight.
Given these divergences, BTC’s 2.4% pullback looks more like a bullish reset than real weakness.
With overexposed longs cleared and futures cooling off, it’s a textbook “reset” setup as Bitcoin season starts to line up.
