Bitcoin holders appear to be entering a "distribution phase," potentially reshaping the cryptocurrency's market dynamics as $105,000 emerges as a critical price level to watch. Recent on-chain data and market analysis suggest that major Bitcoin holders, including both institutional and long-term investors, are actively reducing their positions, a shift that could lead to increased market liquidity and volatility.

Distribution Phase in Full Swing

Glassnode, an on-chain analytics firm, recently reported that all Bitcoin holder groups are now "decisively" in a distribution phase, with those holding 10 to 100 Bitcoins leading the trend. This widespread selling pressure across different wallet sizes signals a significant change in market behavior. Instead of simply accumulating Bitcoin, large-scale holders are strategically managing their sell-offs, a pattern commonly observed during distribution phases in traditional financial markets.

This transition from accumulation to distribution is a key milestone in Bitcoin's lifecycle, indicating a maturing market. The controlled nature of these sales is evident in the shallow pullbacks following Bitcoin's repeated all-time highs in 2025. This suggests that large holders are carefully pacing their sales, preventing drastic price drops while still reducing their holdings.

$105,000: A Crucial Support Level

Several analysts have identified the $105,000 level as a "hidden danger zone" for Bitcoin. On-chain metrics converge around this price, suggesting a significant risk area. UTXO (Unspent Transaction Output) analysis reveals a substantial wall at $105,644, indicating high on-chain accumulation or realization at this price. The realized price for both 1-3 month holders and short-term holders (those holding Bitcoin for less than 155 days) also aligns closely with this level, hovering near $106,000 and $105,350, respectively.

A potential retest of the $105,000 level could trigger sharp volatility and pose risks to leveraged traders in the derivatives market. If Bitcoin's price retreats to this level, it could lead to a major correction, especially if selling pressure from profit-taking or break-even selling intensifies.

Market Factors and Expert Opinions

Despite the distribution phase, the fundamental economic factors supporting Bitcoin remain strong. Bitcoin's price has shown resilience, maintaining levels above $110,000 despite the selling pressure. Furthermore, Bitcoin mining operations are expanding, reinforcing the network's underlying economics. For example, HIVE Digital Technologies has surpassed 16 EH/s in global hashrate and aims to reach 25 EH/s by Thanksgiving.

Analysts hold mixed views on Bitcoin's short-term trajectory. Some predict a potential drop to $100,000 or even lower, while others forecast a rise to $150,000 by September. Tiger Research anticipates Bitcoin reaching as high as $190,000, citing record liquidity and growing institutional adoption. Several experts remain bullish on Bitcoin for 2025, with price targets reaching $200,000 or higher. These optimistic forecasts are often based on factors such as increasing ETF inflows and sustained institutional interest.

Potential Scenarios and Considerations

Several factors could influence Bitcoin's price in the coming months. A break above the $106,500 resistance level, supported by strong volume, could pave the way for a move toward $108,000 or higher. Conversely, failure to overcome the $106,500-$108,000 resistance band could lead to a retracement toward $102,500 or even the $98,000 support level.

Short-term traders might find "buy the breakout" strategies more profitable, while long-term investors may find the "buy the dip" approach more suitable, especially when combined with a Dollar Cost Averaging (DCA) strategy.

The next few weeks will be crucial in determining whether Bitcoin can maintain its upward momentum or if the distribution phase will lead to a significant price correction. The $105,000 level will likely serve as a key battleground between buyers and sellers, potentially dictating Bitcoin's trajectory in the near term.