Long-term Bitcoin (BTC) holders appear to be taking profits as prices test the $120,000 mark.

This has sparked concerns about whether the actions signal cautious profit-taking or a larger trend.

Incoming Correction?

On-chain data shared by CryptoQuant shows that LTHs have flipped net negative at this key resistance level. This indicates that some are cashing out after riding previous bull cycles. While overall selling pressure remains moderate, one major player is drawing attention Galaxy Digital.

Reports suggest the firm offloaded around 80,000 BTC, which points to institutional activity rather than retail-driven selling.

This raises questions about whether this is a short-term adjustment or the early signs of broader de-risking. CryptoQuant also speculated that such actions could prompt other large holders to follow Galaxys lead.

While this can simply be prudent profit-taking after a historic rally, either way, investor behavior at these levels may set the tone for Bitcoins next move.

In yet another concerning trend, CryptoQuant found that US demand for Bitcoin may be cooling after observing signals from the Coinbase Premium Index. The index has recently declined, which indicates that US-based participants are showing less interest in acquiring Bitcoin at current price levels.

It is still important to note that the index remains in positive territory, which means that a premium continues, though notably smaller than during previous accumulation phases.

This softening contrasts with past patterns where demand surged when Bitcoin traded below $105,000. Such zones previously triggered renewed buying interest from US investors, implying those levels were perceived as favorable entry points. With Bitcoin now trading higher, it seems US investors are adopting a wait-and-see approach and are potentially holding out for lower prices.

Historically, US demand has played a crucial role in the crypto assets upward momentum. When the premium index rises alongside price, its typically a bullish sign. But if the index slips into negative territory, it may reflect a weakening in one of the markets most influential buyer segments.

Liquidity Metrics Paint Strong Bull Case

Amid concerns over weakening US demand and long-term holders cashing out, some voices remain confident in Bitcoins strength.

Vtrader Founder Steve Gregory believes that Bitcoin is poised for another significant move upward following recent positive trade developments and strong market momentum.

In a statement to CryptoPotato, Gregory said that the next move this week is up, and predicted a climb to $139,000. While he acknowledges the path wont be a straight line, Gregory added that current momentum feels like peak cycle gains.

Bitcoin being an indicator of global liquidity is becoming more of a credible narrative. If the bitcoin price is just a marker of global liquidity via M2 and global liquidity relative to Bitcoin supply has reached a 12-year high, with ~$5.7 million in global M2 supply per Bitcoin in circulation. This is a very strong bull case that we have more room to run in this bull market.