Bitcoin Hits $111K, Then Drops Below $100K & Flows

Last week’s Bitcoin trading featured rapid swings and heavy transaction activity that directly affected price and liquidity. A weekend rally pushed BTC to roughly $111,000, but a swift unwind of leveraged positions pushed it under $100,000 days later before a partial recovery. Those price moves were accompanied by elevated on-chain throughput and notable capital flows from investment products — concrete signals traders use to judge conviction and vulnerability.

Recent price swings and trading flows

Weekend spike followed by a sharp pullback

Bitcoin climbed to about $111K over the weekend as buy-side demand intensified across major venues. That rally was not long-lived: heavy deleveraging in perpetual futures and concentrated liquidations produced a fast sell-off that tested the $99K–$100K support zone. By midweek BTC had recovered into the low $100Ks, demonstrating short-term resilience but also highlighting elevated volatility.

Fund outflows and short positioning

Institutional and retail investment products registered roughly $1.3 billion in outflows over the week, with Bitcoin-focused funds accounting for about $932 million of that pullback. At the same time, short-BTC products recorded their largest inflows since May, indicating some traders were actively positioning for further downside. These flows show a split between transactional activity on-chain and cautious capital placement in traded products.

Volume, on-chain activity, and liquidity signals

Record on-chain transaction volume

October’s on-chain transaction volume surged to approximately $2.73 trillion, the highest monthly total since the prior November. That increase in on-chain throughput suggests heightened use of the network for transfers, settlements, and trading-related movement — a sign that activity did not fall in step with fund outflows.

Why flows matter for price

Large on-chain volume can reflect real economic use or simply movement between exchanges and custody. When heavy flows coincide with fund redemptions and futures deleveraging, price impact is magnified because liquidity is being withdrawn while sellers need to execute. The week’s pattern — elevated on-chain volume plus institutional outflows and short inflows — created pressure points that amplified intraday swings.

Events driving the swings

Perpetual futures deleveraging

Liquidations in perpetual futures were a primary mechanical driver of the sharp drop from the weekend peak. When highly leveraged positions unwind quickly, forced selling cascades and bids evaporate, which can push price through support levels irrespective of longer-term fundamentals.

Balancer hack and security shocks

A separate, concrete event — a $128 million exploit affecting a DeFi protocol — contributed to short-term risk aversion. Security breaches like this reduce appetite for risk assets, increase withdrawals, and can trigger rebalancing in related holdings, further draining liquidity at fragile moments.

Institutional read: JPMorgan’s view

Following the deleveraging, some institutional analysis concluded that Bitcoin’s correction created asymmetric upside. One major bank noted that with leverage reduced, Bitcoin looks more attractive relative to gold on a volatility-adjusted basis and outlined a multi-month upside scenario that could lift BTC substantially (targets discussed around the $170K level). Institutional commentary like this can reframe trader expectations and attract fresh buying once panic selling subsides.

What traders should watch next

• Support and resistance: $99K–$100K is a key support band; a hold there or a reclaim of $110K will guide short-term bias.
• Flows into/out of Bitcoin funds: continued outflows would keep selling pressure, while renewed inflows would signal restored confidence.
• Futures funding and open interest: falling leverage reduces crash risk, while rising open interest can reintroduce vulnerability.
• On-chain metrics: sustained high transaction volume suggests real activity; a sudden drop could signal liquidity withdrawal.

Conclusion

Last week’s price action made one thing clear: Bitcoin’s trading dynamics are being driven by both mechanical liquidity events and shifting capital flows. The weekend rally to about $111K revealed strong buying interest, but a rapid deleveraging phase — amplified by a notable DeFi exploit and sizeable outflows from investment products — pushed BTC under $100K before a modest recovery. Despite heavy fund redemptions totaling roughly $1.3 billion, on-chain activity remained elevated (October’s volume near $2.73 trillion), indicating continued transactional demand. Institutional reassessments after deleveraging broadside have framed the recent correction as a potential buying opportunity, though traders should keep a close eye on fund flows, futures leverage, and on-chain liquidity to judge how durable any rally will be.