Bitcoin (BTC) is once again testing vital support just above $111,000, as traders speculate whether the recent downturn signals the onset of a deeper correction or a healthy consolidation phase before the next upward movement.
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Having reached an all-time high exceeding $126,000, the largest cryptocurrency has declined nearly 9% in the past week, indicating diminishing momentum amidst overall market uncertainty and escalating U.S.–China trade tensions.
BTC's price is trending downward on the daily chart. Source: BTCUSD on Tradingview
Bitcoin Encounters Key Support as Momentum Wanes
At present, Bitcoin is trading around $111,300, down about 1% over the past 24 hours, after momentarily dropping to an intraday low of $110,292. Technical indicators reveal that the asset is under pressure, with the 20-day and 50-day moving averages trending downward and a bearish crossover appearing on the MACD.
The Relative Strength Index (RSI) has declined into the mid-40s, suggesting weakened buying strength and the possibility of further declines if support fails.
Analysts are watching the $107,000–$110,000 region as a critical short-term demand area. A decisive break below this range could pave the way toward $100,000, while a recovery above $115,000–$123,000 would be necessary to restore bullish sentiment.
“Bitcoin’s structure indicates exhaustion at the top, with a potential double-top formation forming around $126,000,” noted one market analyst. “A weekly close below $110K would likely prompt broader profit-taking.”
Whales Exercise Caution, Bitcoin ETF Inflows Dwindle
On-chain data reveals that BTC whales have increased their short positions, signaling caution among major holders.
This trend coincides with reports of declining ETF inflows, which fell by over $223 million this week following a surge of more than $2.7 billion the previous week. Analysts suggest this cooldown represents a pause in institutional demand after months of aggressive accumulation.
Meanwhile, traders are closely monitoring macroeconomic developments, as gold’s surge to a record $4,200 has attracted some capital away from Bitcoin’s “digital gold” narrative. Weak U.S. economic data and tariff-related volatility have added pressure, nudging some investors back toward traditional safe havens.
Analysts Caution Against Rising Wedge Breakdown
From a technical standpoint, Bitcoin’s weekly chart displays a rising wedge pattern, often seen as a bearish setup. Should BTC close the week below $110,000, this pattern indicates a potential downside target around $74,000, representing a 34% correction.
However, long-term metrics such as hash rate and network activity remain robust, suggesting that any significant pullback could present a buying opportunity for patient investors.
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Currently, Bitcoin’s next move depends on whether bulls can maintain the $110K support level. A strong rebound from this point could pave the way for another attempt toward $126K, but failing to uphold support risks initiating a sharper correction before the next significant rally occurs.
Cover image from ChatGPT, BTCUSD chart on Tradingview
