Bitcoin's Struggles Above $100K Could Lead to a Sharp Decline if the Key Level Isn’t Reclaimed
Bitcoin (BTC) has faced a significant pullback after failing to sustain its rally above the $100K threshold, with prices struggling to reclaim this level over the past week. Despite the recent correction, there is still potential for a bullish continuation if certain technical levels are reclaimed in the near future.
Technical Analysis: A Critical Crossroads for Bitcoin
The Daily Chart: Bearish Momentum or Just a Temporary Setback?
On the daily chart, Bitcoin has struggled to stay above the key psychological level of $100K. After briefly surpassing this price point, the cryptocurrency faced a sharp correction and has been unable to climb back above it. The support zone around $90K has proven resilient, preventing the price from dropping further. However, Bitcoin has consistently been rejected at the $100K resistance, raising concerns about its ability to regain momentum.
If Bitcoin fails to break above $100K soon, there is a risk of further declines. A potential drop toward the $80K region could be on the horizon in the coming weeks if the $90K support zone is broken. The failure to maintain levels above $100K could signal a deeper correction, putting the bullish narrative at risk.
The 4-Hour Chart: Signs of Weakness and a Potential Reversal
On a shorter timeframe, the 4-hour chart presents a more complex picture. Bitcoin has recently broken below the ascending channel pattern that had been supporting the uptrend. This break to the downside could be a signal of a reversal, indicating that the bullish momentum might be fading.
The lower boundary of the ascending channel, alongside the $100K resistance, has been retested multiple times without success. This failure to reclaim these levels suggests that Bitcoin may face further downward pressure. In the short term, there is a real possibility that the price could dip to the $90K level or lower if the current trend continues.
On-Chain Analysis: Long-Term Holders’ Sentiment and Its Impact
While technical analysis provides insight into price action, on-chain metrics offer a deeper understanding of Bitcoin’s market dynamics. One important metric to consider is the Long-Term Holder SOPR (Spent Output Profit Ratio), which tracks the profitability of coins that have been held for over six months.
The current data shows that the realized profit from long-term holders is relatively high, suggesting that many investors who have held Bitcoin for extended periods are seeing profits. However, the realized profit has not reached the extreme levels observed during previous consolidation phases, such as when Bitcoin traded below the $70K mark. This is particularly noteworthy since Bitcoin is currently priced around $100K.
The relatively low selling pressure from long-term holders implies that there is still potential for Bitcoin to rally further, as these holders are not flooding the market with sales. If this trend continues, it could support a price rebound and potentially drive Bitcoin back above $100K in the coming weeks.
Conclusion: What’s Next for Bitcoin?
Bitcoin is currently at a critical juncture. The failure to reclaim the $100K level is a concerning sign, and if the $90K support zone fails to hold, a further decline toward $80K could be in store. However, the lack of significant selling pressure from long-term holders and the potential for bullish continuation if key resistance levels are broken suggest that Bitcoin could still rebound and reach new highs.
As always, investors should monitor Bitcoin’s price action closely and consider various factors, including on-chain data and market sentiment, before making any investment decisions.
Note: This is not financial advice. Before making any investment, it’s important to conduct your own research and assess the market risks.
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