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On July 24, the price of Bitcoin was trading near $118,000, as analysts expected a major short squeeze. Once again, BTC's market share rose to 62%, strengthening its lead in the crypto market. The market structure suggested a potential breakout, despite geopolitical tensions and outflows from ETFs.
Bitcoin briefly dipped to $117,200 during the Asian session, shaking out weak hands before rebounding above $118,400. CoinGlass data showed a rising short-term liquidity imbalance above the spot price. Historically, this situation has triggered sharp upward moves, with traders holding short positions being squeezed to cover as they face sudden price rallies.
Mister Crypto, a well-known analyst, mentioned on X that “Bitcoin liquidity is piling up on the topside,” and called a short squeeze “inevitable.” Fellow trader Crypto Rover agreed with this view, describing the situation as an obvious result of current liquidity trends. Analysts agree that a decisive break above $120,000 would likely target the next resistance near $123,000.
Technical charts strengthen the tug-of-war in operation. The 1-hour BTC/USD chart also exhibited lower highs, with resistance hovering near the $119,000 level. Nonetheless, a subsequent fall was prevented by a stronger low at nearly $117,200. The 4-hour chart revealed a horizontal range between $116,000 and $120,000, with some pundits noting the possibility of a developing head-and-shoulders pattern. Volume was low, and particularly on bullish attempts, signaling possible buyer fatigue.
Bitcoin’s dominance in the total crypto market rose 0.5% to reclaim 62%, according to TradingView data. The bounce came after dominance nearly dipped to 60% earlier this week. Altcoins, which had shown momentum last week, began to lose ground as capital rotated back into BTC.
Trader and analyst Rekt Capital stated that Bitcoin had not broken down from its range, countering fears of a larger correction. “The Altcoin market is reacting as if Bitcoin has broken down. But it hasn't,” he said. “It’s retesting the lower high and range low as support.”
This consolidation comes amid broader uncertainty in the crypto market. The technical setup of the Bitcoin market remains in place, with support above the $116,000 to $ 117,000 level. The longer-term bullish trend remains intact, with major moving averages, including the 10-, 50-, and 200-day EMA and SMA levels. The convergence of these indicators assures that Bitcoin has not been weakened, and a temporary pullback is imminent.
Also Read: Bitcoin and Altcoins Correlation Dropping: What Does it Mean?
The decline in Bitcoin intraday coincided with more than $285 million in net outflows from US-listed Bitcoin ETFs this week. Farside Investors' data confirmed three consecutive days of redemptions, as seen on Wednesday, with $86 million in net outflows. Mixed institutional sentiment was seen, with fidelity leading in outflows and BlackRock IBIT taking in $143 million of inflows.
Meanwhile, fresh volatility was caused by an upsurge of tension between Thailand and Cambodia. Cambodian forces were also said to have fired rockets into Surin province in Thailand, prompting a retaliatory strike. The incident marked the most severe clash in decades, contributing to investor caution during the Thursday session.
Nevertheless, analysts pointed out that long-term Bitcoin investors were cashing in moderate profits instead of panic-selling. CryptoQuant also revealed that the Spent Output Profit Ratio (SOPR) of long-term holders rose to 3.2, indicating controlled distribution rather than widespread exit behavior.
