Glassnode Warns Bitcoin Needs Fresh Catalyst to Sustain Rally as Investors Turn Cautious

Bitcoin’s recent rebound may be losing steam, with on-chain analytics firm Glassnode warning that the leading cryptocurrency could struggle to maintain its upward momentum without a clear new catalyst to excite investors.

In its report published Wednesday, Glassnode said Bitcoin is at risk of a “deeper contraction” if it fails to reclaim key resistance levels. “Without a renewed catalyst to lift prices back above $117.1k, the market risks deeper contraction toward the lower boundary of this range,” the report noted.

At the time of writing, BTC trades around $111,400, roughly 5% below the $117,000 threshold, according to CoinMarketCap. Glassnode added that previous instances of price weakness around this zone have often preceded prolonged mid- to long-term corrections

This gets worse with increased profit-taking among long-term holders, a trend Glassnode says may signal “demand exhaustion.”

Bitcoin Consolidation Likely

Despite the caution, Glassnode’s analysis doesn’t rule out the potential for a recovery. The firm believes that “consolidation is the likely outcome” for Bitcoin following last week’s sharp market crash, when prices briefly dipped to $102,000.

Several market metrics still suggest underlying strength. Spot trading volumes remain robust, and BTC ETFs continue to attract capital. Before the recent downturn, U.S.-listed spot BTC ETFs recorded nine consecutive days of inflows, totaling nearly $6 billion, according to data from Farside Investors.

Another potential tailwind for BTC could come from the U.S. Federal Reserve’s monetary policy. Lower interest rates typically make riskier assets like Bitcoin more appealing, as investors seek alternatives to lower-yielding bonds and deposits. 

Futures markets tracked by the CME FedWatch Tool now imply a 95.7% probability of another rate cut at the Fed’s October 29 meeting.

Analysts See Constructive Setup Into Year-End

Some analysts remain optimistic that macro and structural factors could drive renewed upside in the months ahead. Matt Mena, crypto research strategist at 21Shares, said that with recent liquidations clearing excess leverage, and monetary policy turning supportive, the environment for digital assets looks “increasingly constructive.”

“Bitcoin is setting up for a potential move toward $150,000 as macro tailwinds and institutional flows continue to align,” Mena added.

Others are even more bullish. Arthur Hayes, co-founder of BitMEX, forecast Bitcoin could reach $250,000 by the end of 2025 if institutional demand and policy easing persist.

While short-term volatility remains a risk, many market observers believe the coming months could define whether BTC’s current cycle matures into another major rally — or slips into deeper correction territory.