Market sentiment has fallen into “fear,” and ETFs are seeing sustained outflows, but an overlooked on-chain signal is pointing in the opposite direction.

I. Both bulls and bears are “running out of steam”
Bitcoin is currently trading near $81,461, down 0.39% over 24 hours; Ethereum is at $2,424, down 1.23%.
But market structure matters more than prices: Bitcoin dominance has risen to 59.92%, while Ethereum dominance has fallen to 10.83%. Capital is “sheltering” in BTC, not flowing into altcoins. Derivatives trading volume plunged 32.80% in a single day, as short-term directional bets quickly faded—both bulls and bears are stepping back to watch.
The Fear and Greed Index has fallen to 49, officially entering the “fear” zone. Sentiment is very cold, but it is precisely at times like this that on-chain data starts telling a different story.

II. The key signal: selling pressure has been “exhausted”

Financial expert Richard Byers said in an interview with Bitcoin Magazine that Bitcoin’s “sell pressure exhaustion indicator” has reached its highest level ever.
His exact words were: “The degree of sell pressure exhaustion is the highest I’ve ever seen. Bitcoin is forming a strong bottom.”
This is not an ordinary oversold signal. Byers pointed out that although market sentiment does not feel like an extreme bear market, multiple on-chain indicators are pointing to a bottom forming at the same time. Large-scale institutional buying is continuing, and in his view, further gains are only a matter of time.
Meanwhile, CryptoQuant has offered a broader framework from a cyclical perspective: Bitcoin is retesting its 20-month simple moving average (around $87,165), a key dividing line for determining whether the market is shifting from a “correction” to a “new uptrend.” CryptoQuant defines the area between the lower Bollinger Band (around $52,694) and the 20-month moving average as the “accumulation range,” and believes the market may have already entered the early stages of a new uptrend.
In other words, the price is grinding around $81,000 in the short term, but on-chain data says “a bottom is forming, and the cycle may be shifting.”

III. But ETFs are “voting with their feet”

On-chain signals are bullish, but fund flows are showing the opposite.
Bitcoin spot ETFs saw net outflows of $82.41 million yesterday, bringing cumulative outflows this month to $614.9 million; Ethereum ETFs saw net outflows of $69.7 million, with cumulative outflows this month reaching $955 million. BlackRock’s IBIT saw $71.8 million in outflows in a single day, while ETHA saw $69.7 million in outflows.
“Paper hands” are retreating, while “diamond hands” are buying. The two forces are locked in a tug-of-war at the $80,000 level, which is the fundamental reason the price is “moving sideways.”

IV. Macro outlook: Warsh has offered a “breathing window”

Dovish comments from Fed Chair Warsh pushed the odds of an October rate hike from 27% to below 15%. Short-term liquidity pressures have eased for now.
But note: “no hike in October” does not mean “rate hikes are over.” The probability of another 25-basis-point hike in December is rising, and the tug-of-war between rebounding inflation and a cooling labor market will make the Fed’s path highly uncertain. Before the October FOMC meeting (October 27-28), the market will likely keep wavering between “catching its breath” and “staying alert.”#WCTCS9

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