Bitcoin Traders: Brace for a $100K Pullback Before the Next Rally

Market euphoria hits a wall—Bitcoin’s parabolic run may need a breather. Here’s why traders should prep for a dip to $100K before the next leg up.

Technical indicators scream overbought, while leveraged longs pile in like it’s 2021 all over again. The smart money? They’re quietly scaling out, waiting for the inevitable flush.

Remember: corrections aren’t crashes. A 20-30% pullback would be textbook after a 150% YTD rally—especially with Wall Street’s latest ’crypto is dead’ narrative getting airtime again.

Bonus cynicism: If history repeats, this dip will arrive just as your cousin’s ’sure thing’ altcoin portfolio hits liquidation.

Source: Coinalyze

Data from Coinalyze showed that the OI trend has flattened out after BTC reached a new all-time high. The Funding Rate had been strongly positive, but over the past 24 hours, it has fallen to neutral levels.

Traders need to prepare for a short-term pullback

Source: CryptoQuant

In a post on CryptoQuant Insights, user Darkfost pointed out that the spot demand was dwindling. The futures trading volume was going strong, highlighting high speculative interest. Yet, the drop in spot volume as Bitcoin entered its price discovery phase was a disappointment.

The lack of spot demand suggested investors were cautious about buying BTC above the $94k-$96k area. This region served as resistance earlier in May before the price broke out to nearly touch the $112k mark.

A rally led by the derivatives market could be at risk of heightened volatility and deeper pullbacks.

Source: BTC/USDT on TradingView

Zooming out to cover the price action of the past six months, the 1-day chart of bitcoin highlighted a possible range formation (white). Two routes were possible in the coming weeks- a sustained uptrend, or a reset to $100k or even $93k.

When ranges form, price action within the range induces liquidation levels to build up around the extremes of the range. The retracement to $77.5k in March and the subsequent recovery saw short liquidations build up at $99.6k, $108k, and $113k.

The first two levels have been swept. The dwindling spot demand suggested a market reset was possible, and $113k might be out of reach for now.

Source: Coinglass

The 3-month chart underlined the build-up of liquidation levels at $100k and $92k as the next potential targets.

Depending on the profit-taking activity and whether the bulls can find their feet again, Bitcoin might cede $106k to the bears again.