In a more fundamental breakdown, traders are warning that Bitcoin’s bull run could collapse if the $100,000 support zone fails to hold. A recent CoinMarketCap report indicates mixed technical indicators. RSI suggests a feeling of exhaustion in buyers, but the signs of recovery are still evident. Many traders see the $100,000 zone as a possible accumulation point at a time when the risks are high due to the weakness of momentum.
Bitcoin is trading at $123,839, down 0.66%, after failing to break above the resistance at $125,081. This happens following a sharp rally from $108,371, with Fibonacci levels giving immediate support at $122,000.
With the RSI near 69.65, buying strength could be fading. On the higher time frame, bearish divergences are visible near recent highs, indicating weakening momentum. Analysts add that volume is trending lower on the run-ups, suggesting that buyers are losing conviction.
Should Bitcoin close below the $122,000 level, traders would then eye a deeper correction toward $117,000, or possibly even down to $112,000. The huge accumulation zone from $108,000 to $110,000 remains the key defense in all this; however, the focus remains glued to $100,000, the psychological barrier that may just decide the fate of this uptrend.
Heavy sell-offs and a drifting sentiment toward a broader market correction would follow failure to hold $100,000. Traders remain cautious, watching closely to see whether bulls can keep this zone or a breakdown will follow.
Large Bitcoin holders have become increasingly active. There are movements in dormant whale wallets, with some moving large amounts and converting BTC to ETH. Such movements create supply pressures and are usually followed by short-term corrections.
Simultaneously, inflows into the spot Bitcoin ETFs are dwindling, thus lessening institutional interest. With diminished activity coinciding with U.S. market holidays and Wall Street closures, short-term control has fallen into the hands of the sellers. Meanwhile, the waning trading volumes have poured more fuel on volatility, making the markets an easy target for abrupt reversals.
With liquidity drying up, traders are becoming increasingly reactive to even the slightest price movement. This has set the stage for exaggerated moves. The tug of war between whale activity and ETF inflows may determine the market's fate: stabilization or further tapering.
Besides the technical indicators, macroeconomic factors add to the uncertainty. Investors are jittery amid the political noise in Washington and shifting expectations regarding Fed policy. Stock indices, led by the Dow Jones Industrial Average, S&P 500, and Nasdaq, have softened. The current scenario has left risk-on trades in the cryptocurrency market somewhat skeptical.
However, if the Fed starts cutting interest rates toward the end of Q3 or October, this could stop the bleeding. Lower borrowing costs could potentially stimulate demand for digital assets and further solidify Bitcoin’s claim to serve as a hedge against inflation.
According to CoinGlass data, the funding rate weighted by open interest for Bitcoin has been rising since mid-September and is now firmly clustered around 0.015%. This extreme bullish leverage is evident in traders willing to pay a premium of more than $123,000 to maintain their long positions.
Bitcoin is clearly at an inflection point right now as it attempts to hold above a critical support level of approximately $100,000. Technical indicators suggest weakening momentum, with an RSI divergence and a decline in volume, all of which indicate further corrections. The outward flow of whales, slowing ETF inflows, and a global market full of uncertainty are further weighing on the price.
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