Key takeaways:
Bitcoin’s overall uptrend and on-chain metrics indicate the market is still in an expansion phase.
Robust buying activity from “sharks” and critical trendline support hint at a possible BTC rebound.
Bitcoin (BTC) tried to bounce back a day after traders experienced the largest single-day liquidation ever, with over $5.39 billion in leveraged positions closed in 24 hours, double the amount seen during the “COVID-19 crash” in 2020.
As of Saturday, BTC’s price had risen by 8.50% after hitting a local low of around $103,000. At the time of writing, it remains 11% below its record high of $126,300, reached earlier in the week.
Can Bitcoin’s recovery continue? These three charts suggest favorable technical conditions for a potential rally in the upcoming days or weeks.
Bitcoin uptrend unaffected by $5.39 billion liquidation
Bitcoin’s recent correction may appear severe on shorter timeframes, but a broader perspective shows it’s actually less dramatic than previous pullbacks.
On the weekly chart, BTC has so far declined by less than 10%, significantly less than the 14–15% drops observed in March 2025 and July 2024, which were both followed by strong recoveries.
Bitcoin’s price remains firmly within its ascending channel, a bullish pattern that has directed its uptrend since mid-2023.
Buyers have consistently entered the market whenever BTC has approached the lower edge of this channel, igniting new rallies towards the upper end.
The important level to monitor now is the 20-week moving average (20-week MA) near $111,000, according to analyst Michaël van de Poppe.
Maintaining above the 20-week MA support could signify a final capitulation phase, akin to the COVID-19 crash and the FTX bottom.
This would pave the way for the next significant BTC uptrend, targeting $140,000-150,000 by the end of the year.
BTC sharks capitalize on the dip
While many smaller traders were liquidated during the $5.39 billion crash on Friday, medium-sized holders, referred to as “sharks,” took the opportunity to buy.
The daily Shark Net Position Change, which tracks wallets holding between 100 and 1,000 BTC, has spiked to 190,296, its highest point since September 2012, according to Glassnode data.
Furthermore, the Bitcoin supply held by this group has surged to a record high on Friday, despite the price drop, indicating less panic among more seasoned investors.
Related: Bitcoin slump may rebound up to 21% in 7 days if history repeats: Economist
The active buying from these larger entities could lay the foundation for Bitcoin’s next major recovery if this trend persists.
Bitcoin Bollinger Bands still “squeezing”
Bitcoin’s recent correction might represent a mid-cycle pause rather than the beginning of a prolonged bear market, according to chartist The Great Mattsby.
Historically, every Bitcoin bull run concluded only after its monthly Bollinger Bands, which indicate volatility, had fully expanded, as illustrated in the chart below.
These bands widen when market volatility increases and contract when price movements diminish.
In previous bull phases, such as 2013, 2018, and 2021, Bitcoin peaked exactly when these monthly bands widened significantly, indicating overheated volatility.
Currently, however, these bands are still tightening, or “squeezing,” which may signal impending price surges if past trends hold true.
The Great Mattsby stated:
Historically, bear markets don’t commence while the monthly Bollinger Bands are still squeezing. They begin after their expansion concludes.
This article does not constitute investment advice or recommendations. All investment and trading activities involve risks, and readers should perform their own research before making decisions.
