Bitcoin Price Analysis: BTC Risks Facing Extended Retracement If it Loses This Level

3 hours ago 8

Bitcoin has surged to a new all-time high, briefly exceeding the $108K threshold in an impulsive rally.

However, another Federal Reserve rate cut and some cautious comments unexpectedly resulted in a rejection, increasing the likelihood of an extended retracement.

Technical Analysis

By Shayan

The Daily Chart

Bitcoin recently achieved a new all-time high of just over $108K following a powerful rally, breaking through the significant psychological resistance at $100K with remarkable momentum. However, the bullish momentum has since faded, and the price is exhibiting sideways movement. A recent Federal Reserve rate cut unexpectedly triggered a market shakeout, resulting in a notable pullback from the $108K level.

This rejection, coupled with a bearish divergence on the RSI indicator, suggests the likelihood of a corrective retracement phase. The ascending channel’s middle boundary, around the $100K mark, is expected to serve as a critical support zone. Buyers may capitalize on this level to re-enter the market, potentially driving the asset back toward the $108K resistance region.

The 4-Hour Chart

On the 4-hour chart, BTC has displayed signs of weakening bullish momentum and increased volatility upon reaching the $108K resistance. The price has entered a phase of sideways consolidation, hinting at potential profit-taking and distribution by market participants.

Currently, Bitcoin is trading within an ascending wedge pattern, often indicative of a short-term bearish reversal. A brief correction or distribution phase near the $108K level appears likely in the near term. While the broader uptrend remains intact, traders should exercise caution and avoid succumbing to FOMO.

If a deeper correction unfolds, the asset could find support within the 0.5–0.618 Fibonacci retracement levels, providing a foundation for the next potential leg up in Bitcoin’s ongoing rally.

On-chain Analysis

By Shayan

Long-term holders represent a critical segment of market participants, and monitoring their behavior can provide valuable insights into future market trends. The Binary Coin Days Destroyed metric is a key tool for analyzing their activity. This metric assigns a value of 1 when the Supply-Adjusted Coin Days Destroyed (CDD) exceeds its average and 0 otherwise.

The accompanying chart illustrates the 30-day SMA of the Binary CDD metric alongside Bitcoin’s price. Spikes in this metric often signal potential selling pressure from long-term holders, as historically, significant price declines have followed such surges.

Currently, the Binary CDD metric has seen a substantial spike, coinciding with Bitcoin’s recent achievement of a new all-time high at $108K. This surge suggests that long-term holders may view this price level as an opportune moment to distribute their assets, thereby reducing their market exposure. If this selling pressure intensifies, it could contribute to further volatility and a potential price correction.