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Bitcoin's price dropped below $110,000 after a brief attempt to regain its recent high. This pullback was driven by traders observing technical resistance and on-chain signals before the U.S. Independence Day festivities. Currently, BTC is trading around $108,716, lower than its recent peak but within a consolidation zone. Market opinions are split, with some anticipating a rebound while others warn of a potential further decline.
The cumulative volume delta (CVD) of Bitcoin spot takers is currently trading in positive territory, indicating that buying activity significantly outweighs selling behavior. A steady rise in the CVD is attributed to buyer accumulation. Recent evidence from CryptoQuant indicates that spot buyers of Bitcoin remain positioned even after the correction, with Bitcoin price now below $110,000.
This pattern is supported by other metrics, including the Money Flow Index (MFI), which has breached the neutral 50 level. An MFI trending upward is a signal of high capital inflow, usually contributing to favorable trending pricing. It also indicates that the Awesome Oscillator (AO) has crossed into positive territory, suggesting that the market momentum has shifted from bearish to bullish. Provided that these metrics remain at their current level, Bitcoin may attempt to rise to a price of $112,000 in the short term.
On-chain volume and funding rates further support a cautious, bullish stance. However, analysts emphasize that breaking through the $110,000–$112,000 resistance range remains essential before any price discovery can begin.
Although the on-chain factors are healthy, Bitcoin has consistently turned back at the $110,000 level. This has now been seen three times since the peak in May, prompting comparisons to previous cycle tops where similar patterns preceded significant declines. For instance, multiple rejections in January near $107,000 led to a 14% drop over two weeks. A similar move occurred after March rejections near $73,800.
Traders and analysts are closely watching the $108,000 to $107,500 support band. This area includes the 50-day simple moving average and has acted as a buffer zone in recent sessions. A breakdown below this could expose BTC to further downside toward $105,000, where additional moving averages and psychological support reside.
On the other hand, if Bitcoin holds above $108,000 and breaks past $110,000, a short squeeze could follow. According to CoinGlass, the largest liquidity cluster worth $121 million sits just above that threshold. A break could force short sellers to cover, possibly driving the price to $114,000.
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Statistics from CoinGlass and TradingView indicate that critical liquidity zones are emerging around areas of support and resistance. There are large buy walls between $108,000 and $ 105,000, and short liquidations are occurring around $110,000. These zones have prompted traders to exercise caution, and in most cases, they have used the zones as pivot points.
Technical divergences, particularly in the Relative Strength Index (RSI), also suggest caution. While price action approaches record highs, the RSI fails to match the upward trend which is often a sign of weakening momentum.
In general, the Cryptocurrencie’s price action remains trapped between intense demand below $108,000 and significant resistance around $110,000. Future action may be determined by observing the trader's response to upcoming macroeconomic signals and immediate momentum indicators.
