BlockBeats News, August 27th, Glassnode released its latest weekly on-chain report stating that Bitcoin has rebounded by 26% since the mid-August low, with a record-breaking single-day short squeeze acting as the catalyst for this round of upside. Subsequently, ETF inflows, decreasing exchange balances, and continuous accumulation by wallets of all sizes further supported the rebound.

The report noted that August 19th saw the largest single-day short liquidation scale in Glassnode data since 2019. During this upward trend, 85% of liquidations came from short positions, with the market then absorbing 86% of structured liquidation liquidity along the way. Currently, a large number of short liquidation positions are concentrated in the $82,000 to $86,000 range, while long liquidation areas range from $60,500 to $62,400.

On the funding side, the US Bitcoin spot ETF saw a cumulative net inflow of $2.23 billion during this uptrend, with no outflows for 7 consecutive days, marking the strongest 7-day inflow this year. At the same time, the open interest of Bitcoin futures contracts decreased by 11% in BTC terms, and the perpetual contract funding rate remained largely neutral, indicating that this uptrend was not driven by additional leverage from long positions chasing the rise.

Since the low point on June 30th, entities holding between 1,000 and 10,000 BTC have decreased their holdings by approximately 50,500 BTC, while entities holding over 100,000 BTC have increased their holdings by around 59,100 BTC. Glassnode believes this reflects Bitcoin shifting from large holding entities to larger address groups such as institutional custody systems. Meanwhile, the 30-day cumulative trend scores of wallets of six different sizes are at or above a neutral level of 0.5, indicating that the current accumulation behavior has a broad market base.

The correlation between this rebound and the traditional US stock market has significantly decreased. During this uptrend, Bitcoin rose by 25%, while the S&P 500 index fell by 1.7%. The one-month rolling return correlation between the two was close to zero, indicating that this rise was more driven by capital flows within the crypto market itself rather than by risk appetite in the traditional stock market.

From a technical and on-chain supply structure perspective, the $83,000 to $86,000 range is currently the most critical resistance area. Near $80,800, the first self-custodied cost basis supply band appeared, around $82,300 is the market maker Gamma flip position, and the $82,000 to $86,000 range also holds a significant number of short liquidation positions and long-term holder supplies. Glassnode believes that if Bitcoin further rises to this area, it will test whether long-term holders are willing to sell at a price close to their cost basis.

On the downside, $70,000 is the cost basis for short-term holders, while $62,000 to $65,000 is the key cost basis range formed during the June to August bottoming process. If Bitcoin falls below $70,000, the market may further test the $62,000 to $65,000 support range. If it revisits the current short squeeze starting point near $62,900, it may indicate a complete reversal of this rebound trend.

The options market indicates that the market currently leans towards Bitcoin maintaining its range. The implied 70% confidence interval for options expiring on September 25 is around $69,000 to $89,700, with the median price not far from the current price. Glassnode suggests that the options market is not currently viewing a breakout above $86,000 or a return below support as the most likely scenario.

This market trend exhibits a phased recovery feature of "short squeeze initiation, ETF inflows coupled with spot demand, and ongoing on-chain supply tightening." If Bitcoin can hold above $83,300 and ETF inflows continue, it will further demonstrate that the overhead supply wall is being absorbed. Conversely, the $70,000 short-term holder cost basis and the $62,000 to $65,000 range will be key support levels to watch during a downward movement.