Analyst: Bitcoin Pullback Finds Support at $112K as Short-Term Holder Cost Becomes Key Level

Key Points:Bitcoin slipped to $112,000 ahead of Powell’s Jackson Hole speech, aligning with the average cost basis of coins held <3 months.On-chain analyst Murphy says this level is crucial for short-term sentiment, as it marks the breakeven for the most active BTC holders.Selling pressure has eased, with investors showing anxiety but no panic, suggesting cautious stability.Bitcoin Tests $112K Support Ahead of Fed SpeechBitcoin’s price correction to $112,000 on Thursday has highlighted a crucial on-chain support zone, according to data shared by analyst Murphy via BlockBeats.The level corresponds to the average turnover cost of BTC held for less than three months — a key metric often used to measure the sentiment of short-term holders (STHs). These investors are typically the most active in reacting to volatility, and their breakeven levels can dictate near-term price floors.Short-Term Holder Cost Basis as Sentiment GaugeMurphy emphasized that when Bitcoin trades above the short-term holder cost basis, sentiment among speculative investors tends to remain optimistic. Conversely, sustained dips below this level often shift sentiment toward pessimism and increase sell pressure.So far, Bitcoin’s retreat has tested but held the $112,000 line, signaling that sellers are easing off. While investor sentiment has turned cautious, there are no signs of mass panic, the analyst noted.Market Context: Powell’s Speech in FocusThe pullback came as traders braced for Federal Reserve Chair Jerome Powell’s remarks at Jackson Hole, which are expected to provide direction on the U.S. interest rate outlook.Macro uncertainty has weighed on risk assets all week, but Bitcoin’s ability to hold the short-term holder cost support suggests the market is stabilizing around this level.What to Watch$112K remains the key line: A sustained hold could keep Bitcoin range-bound until Powell’s speech.Break below = sentiment shift: If BTC closes below the cost basis, analysts warn of deeper downside pressure.Macro-driven moves: Fed commentary will likely dictate whether BTC can rebound toward $115K+ or slide further.