TL;DR
- Bitcoin tested $116,200 on October 28, 2025, before retreating to the $112,700 level amid a broad crypto market selloff.
- The $113,600 short-term holder cost basis has emerged as a critical support level that could determine Bitcoin’s near-term direction.
- BTC crossed above its 50-day moving average earlier in the session, a traditionally bullish short-term signal.
- Bitfinex analysts warned that a sustained break below current support could see Bitcoin test $97,500.
- Despite the pullback, on-chain metrics suggest cautious optimism is gradually replacing defensive positioning among market participants.
Bitcoin entered a critical technical zone on October 28, 2025, after the world’s largest cryptocurrency failed to hold gains above $116,000 for the second consecutive session. The price action has drawn significant attention from analysts and traders alike, as Bitcoin hovers around levels that could determine whether the current cycle continues its upward trajectory or enters a deeper correction phase.
The session began with promise. Bitcoin climbed above $116,000 in early trading, with intraday highs reaching approximately $116,200. The move was supported by encouraging macro conditions, including softer inflation data and growing speculation that the U.S. Federal Reserve may consider rate cuts in the coming months. Crossing above the 50-day moving average added to the bullish narrative, as this technical indicator has historically signaled renewed short-term momentum.
However, the optimism proved short-lived. Sellers stepped in with conviction during the U.S. afternoon session, driving Bitcoin back below $113,000. By the close of trading, BTC was changing hands at approximately $112,700, down nearly 2% over the preceding 24 hours.
Analyzing the $116K Rejection Pattern
The October 28 session was nearly identical to the previous day’s price action, creating a concerning double-rejection pattern at the $116,000 resistance level. This level has now been tested and rejected twice within 48 hours, which technical analysts view as a sign of strong overhead supply.
When an asset repeatedly fails at a resistance level, it typically indicates that sellers are actively defending that price zone. Each unsuccessful attempt to break higher tends to weaken buyer confidence and can eventually lead to a breakdown below support levels as frustrated longs exit their positions.
The $116,000 level is particularly significant because it represents the upper boundary of Bitcoin’s recent trading range. A sustained break above this level would likely trigger a wave of short liquidations and attract momentum buyers, potentially sending prices toward the $120,000 to $125,000 zone. Conversely, continued rejections increase the probability of a pullback toward the lower end of the consolidation range.
The $113,600 Cost Basis: Make or Break Level
Bitfinex analysts highlighted Bitcoin’s short-term holder cost basis at $113,600 as the most critical level to watch. This metric represents the average acquisition price of Bitcoin for investors who have held their coins for a relatively short period, making it a key psychological and financial threshold.
“Trading above this level has historically marked the transition from corrective to accumulation phases,” the Bitfinex report noted. The current price action around this level suggests the market is in a state of indecision, with neither bulls nor bears establishing clear control.
The stakes are high. According to Bitfinex’s analysis, if Bitcoin fails to sustain above the $113,600 cost basis, the risk of a deeper retracement increases substantially. Their analysts identified $97,500 as the likely lower bound of the current consolidation range — a level that would represent a roughly 14% decline from the October 28 closing price and a nearly 16% drop from the recent highs near $116,200.
Macro Tailwinds Not Yet Reflected in Price
Interestingly, Bitcoin’s price weakness on October 28 came despite several positive macroeconomic catalysts. Softer inflation prints in recent weeks have revived speculation about potential interest rate cuts from the Federal Reserve, a development that traditionally benefits risk assets including cryptocurrencies. Additionally, signs of easing U.S.-China trade tensions have contributed to a broadly supportive environment for financial markets.
The fact that these tailwinds have not translated into Bitcoin price appreciation suggests that other forces are currently dominating market dynamics. The most prominent of these is the remarkable rally in AI-related technology stocks, led by Nvidia’s surge toward a $5 trillion market capitalization. The concentration of institutional capital in the AI trade appears to be drawing liquidity away from cryptocurrency markets, at least in the short term.
Glassnode’s on-chain analysis supports this interpretation, noting that while cautious optimism is beginning to replace defensive positioning among Bitcoin holders, participation and on-chain activity remain muted. The analytics firm concluded that “until conviction deepens and demand broadens, Bitcoin is likely to remain in rangebound consolidation.”
What Traders Should Watch Next
For Bitcoin traders and investors, the coming days will be pivotal. Key levels to monitor include the $113,600 short-term holder cost basis as immediate support, with $110,000 as a secondary support level. On the upside, $116,000 remains the resistance to beat, followed by the psychologically important $120,000 mark.
The broader cryptocurrency market will also play a role in Bitcoin’s direction. The underperformance of major altcoins — with Ether dropping below $4,000 and Solana and Litecoin each declining nearly 4% — suggests that market-wide sentiment remains fragile despite the generally positive macro backdrop.
Trading volume patterns in the coming sessions will be particularly telling. An increase in buying volume near the $113,600 support level would signal accumulation and increase the likelihood of another attempt at the $116,000 resistance. Conversely, rising selling volume could indicate that the market is heading toward a deeper correction.
Why This Matters
Bitcoin’s battle at the $116,000 resistance and the $113,600 short-term holder cost base is more than just a technical exercise — it represents a broader test of the cryptocurrency market’s resilience in the face of competing capital demands from the AI-driven tech rally. The outcome of this technical standoff will likely set the tone for Bitcoin’s price action through the remainder of October and into November. With macro conditions remaining supportive but capital flowing elsewhere, the crypto market may need a catalyst beyond favorable monetary policy to reignite its bullish momentum. The information presented in this article is for educational purposes only and does not constitute financial advice. Always conduct your own research before making investment decisions.
Crossing above the 50-day moving average before the rejection at $116,200 is actually a bullish technical signal that got overwhelmed by selling pressure. The fact that BTC touched that average and briefly held above it before the dump suggests the bulls are not completely exhausted. $113,600 is the line.
Bitfinex analysts tagging $97,500 as the next major support if $113,600 fails is based on historical short-term holder cost basis behavior. The 2% decline over 24 hours is manageable but the pattern of repeated $116K rejections is concerning. On-chain metrics showing cautious optimism is a small comfort.
On-chain metrics shifting from defensive to cautiously optimistic despite the double rejection is an interesting divergence. Usually positioning aligns with price action but this time holders seem to be absorbing the selling. The $113,600 level holding so far supports the idea that stronger hands are defending.
The softer inflation data and rate cut speculation should be bullish for BTC but the market is ignoring macro tailwinds right now. When the 50-day MA crossover gets reversed this hard, it usually means larger time frame sellers are active. Need to see a daily close above $116K to invalidate the bearish thesis.