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Bitcoin’s recent pullback is widely viewed as a healthy correction, with analysts noting it mirrors mid-cycle pauses seen in previous bull markets rather than signaling a structural top.
On-chain, institutional, and macroeconomic catalysts remain supportive, including shrinking exchange reserves, continued ETF inflows, and expectations of Fed policy easing, which are expected to boost liquidity conditions.
Most institutional forecasts still cluster around $180,000 to $220,000, with technical indicators suggesting that BTC is resetting momentum before attempting another move toward long-term resistance levels.
Bitcoin began a notable pullback after failing to sustain upward momentum near the $100,000 region, a level that acted as psychological resistance for several weeks. The retreat is currently being viewed by many analysts as a normal and healthy correction within a larger bullish macrostructure.
Volatility has increased across the cryptocurrency market, with leveraged positioning unwinding, macroeconomic expectations shifting around the Federal Reserve's rate-cut trajectory, and liquidity thinning as the year-end approaches.
Yet despite these short-term headwinds, long-term indicators continue to suggest that the broader bull cycle remains structurally intact.
On-chain data suggests a continued, accelerating drawdown in the supply of exchange-held BTC. According to CryptoQuant, Bitcoin exchange reserves have sunk to around 2.39 million BTC, their lowest level in modern trading history.
The multi-year trend has accelerated over the last 12 months in a market defined by accumulation over distribution.
A shrinking supply on centralized platforms typically means that available liquidity becomes tighter during bullish periods, as seen during previous run-ups in 2016-2017 and 2020-2021.
Spot Bitcoin ETF flows, while no longer at the peak levels seen earlier this year, continue to demonstrate sustained net inflows over multi-week periods.
Analysts say structural inflows are likely to persist as long as macro conditions remain supportive.
Several fund managers note that Bitcoin is increasingly being treated as a strategic allocation asset, a shift not present in earlier cycles.
Markets are currently pricing a greater likelihood of Federal Reserve rate cuts in 2026 as inflation stabilizes and economic growth cools.
Historically, rate-cut cycles have improved liquidity conditions, benefiting risk assets such as Bitcoin.
Tom Lee, managing partner at Fundstrat, believes that if the Fed eases policy at the expected September FOMC meeting, Bitcoin could quickly regain its bullish momentum.
A rare alignment is emerging across mainstream banks, quantitative analysts, and independent crypto researchers most of whom project that Bitcoin will reach $180,000-$220,000 over the next 12-18 months.
In a widely circulated forecast, Engel predicts Bitcoin could “double toward $200,000” over the next year, driven by accelerating adoption and structural inflows.
He adds that at 0.93x its power-law growth trend, Bitcoin remains in an “early accumulation phase” with strong return asymmetry.
Engel estimates that the downside risk below $125,000 is now less than 5%.
A 10,000-path trend-constrained Monte Carlo model places Bitcoin’s median 12-month projection at $200,965, with the 25th to 75th percentiles spanning $161,000 -$251,000.
The analysis reinforces what institutions are signaling: even conservative scenarios point toward higher valuations.
Lee reiterated his year-end target of $200,000, noting that policy easing from the Federal Reserve could serve as the key catalyst.
He argues that Bitcoin remains structurally underowned relative to the ETF-driven demand curve established earlier in the cycle.
Standard Chartered’s head of digital assets research, Geoffrey Kendrick, reaffirmed his $200,000 year-end prediction, citing steady ETF inflows and the delayed supply shock from the 2024 halving.
Kendrick expects Bitcoin to decisively break its previous all-time high before pushing toward $135,000 in the near term, paving the way for the higher range targets.
Also Read: Bitcoin Falls as Support Zones Break and Pressure Builds
On higher timeframes, the market appears to adhere to the familiar rhythm of testing long-term resistance, cooling off and resetting momentum for the next expansion phase.
On the monthly log-scale chart, Bitcoin has again pressed into the upper boundary of its 12-year rising wedge, a trendline that has inhibited major advances during each cycle since 2012.
The price momentarily broke above the area before rejecting, another similar rejection leading up to the 2013, 2017 and 2021 continuation rallies.
This behavior is historically standard: anytime BTC reaches this multi-cycle ceiling the market usually stalls, consolidates or retraces prior to gaining enough strength to break out again.
The latest rejection fits fully within that framework, it indicates a controlled cooling period and not the beginning of structural reversal.
Resistance levels are tightly stacked above the market with R1 at $121,000, R2 at $149,000, and major extensions at above $191,000 and $233,000.
All of these levels fall exceptionally close to institutional forecasts and the upper percentiles of Monte Carlo simulations, strengthening the importance of these levels technically.
On the downside, Bitcoin has strong structural support in the $70K-$85K range, an area backed by trendline confluence, historical volume, and the rising power-law channel that has been leading Bitcoin's macro trajectory for a decade.
A retest of this level would fall squarely within a healthy bull structure.
The RSI has rolled over from elevated territory, which puts less pressure on Bitcoin without going anywhere near the likelihood of extreme readings we typically see at cycle highs.
Rather than indicating exhaustion, the reset means the market is working through some of the previous price retracement, gaining in profit as the sentiment stabilizes.
Also Read: Harvard Boosts IBIT Stake as Bitcoin Faces Heavy Outflows
The most recent drawdown in Bitcoin has added a healthy level of volatility and caution to the market, but the underlying fundamentals have not changed.
Exchange reserves have continued to decline, institutional forecasts are agglomerating around the range of $200K, and long-term technical structures are still expanding, not exhausting.
While short-term turbulence may persist, especially as macro uncertainty and leverage unwinds play out, the analyst consensus is clear: the broader bull market is far from over.
1. Why is Bitcoin pulling back right now?
Bitcoin is cooling off after testing major resistance near $100,000, with leverage unwinding and macroeconomic uncertainty adding volatility.
2. Does this correction mean the bull market is over?
No. On-chain supply data, ETF inflows, and long-term technical structures all indicate the broader bull trend remains intact despite short-term price weakness.
3. What targets are analysts expecting next?
Most major institutions and quantitative models project Bitcoin to reach $180,000 to $220,000 within the next 12-18 months, with some calling for higher levels if liquidity improves.
4. What are the biggest bullish catalysts right now?
Shrinking exchange reserves, steady spot ETF demand, improving macro expectations, and the lingering supply shock from the 2024 halving.
5. What levels should traders watch?
Key resistance sits at $121K, $149K, and $191K, while strong structural support remains in the $70K-$85K zone well within a healthy long-term uptrend.
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