Bitcoin’s 99% Profit Milestone Signals Potential 10% Correction

Bitcoin’s impressive 11.73% gain over the past week has created an unprecedented market condition where 99.3% of all circulating Bitcoin supply is now held at unrealized profits, according to data from on-chain analytics platform CryptoQuant. This milestone, occurring with Bitcoin trading around $122,246, reflects overwhelming profitability across the network and underscores the market’s current strength. The achievement comes alongside multiple positive developments, including surging ETF inflows and bullish changes in option trading calls, all pointing to renewed market confidence.

However, market analyst Ted Pillows cautions that this rare event has historically served as a precursor to short-term market corrections. In an X post on October 4, Pillows highlighted that the last three instances when Bitcoin’s ‘supply in profit’ ratio climbed above 99% were followed by brief corrections ranging from 3% to 10%. These drawdowns typically function as ‘cooling phases,’ allowing overheated momentum to reset before prices resume their upward trajectory. The current market condition, while demonstrating strong holder profitability, may be setting the stage for a similar pattern.

Adding to the cautionary outlook, analyst Rekt Capital shares a similar viewpoint through separate technical analysis. Rekt Capital notes that Bitcoin’s rejection at its all-time high around $124,000 has consistently been followed by a 13% price pullback in historical patterns. This technical perspective aligns with Pillows’ on-chain analysis, creating a convergence of warning signals from different analytical approaches.

Based on these combined analyses, Bitcoin faces potential downside risk to between $106,000 and $109,000 before finding a substantial support zone for the next leg upward. This projected correction range represents approximately a 10% decline from current levels, consistent with historical patterns observed during similar market conditions. The convergence of these analytical perspectives from multiple experts strengthens the case for near-term caution despite the overwhelmingly bullish sentiment currently dominating the market.

Despite the strong cautionary predictions, historical data reveals that October has traditionally been a bullish trading month for Bitcoin, with an average gain of 21.89% and a median gain of 21.20%. This seasonal strength provides important context for the correction warnings, suggesting that any potential pullback might be temporary within a broader upward trend. Coincodex analysts acknowledge the current high bullish sentiment while noting the market’s overheated condition, as evidenced by the Fear & Greed Index climbing to 71, representing extreme greed.

In the short-term, Coincodex analysts project Bitcoin could rise to $130,994 within the next five days before experiencing an eventual retracement to around $126,535. Looking further ahead, they maintain a bullish long-term outlook, predicting Bitcoin will reach $140,009 by the end of 2025. With a current market capitalization of $2.43 trillion and market dominance of 58.4%, Bitcoin remains the undisputed leader in the cryptocurrency space, and these correction predictions are viewed by most analysts as healthy consolidation within a broader bull market rather than a trend reversal.