Bitcoin Begins Correction After All-Time High: Technical Analysis (August 20, 2025)
- What’s Driving Bitcoin’s Current Price Action?
- Bitcoin Technical Indicators: Bullish or Bearish?
- Derivatives Data Tells a Contradictory Story
- Market Sentiment: From Greed Back to Fear
- Two Possible Scenarios Ahead
- FAQs: Your Bitcoin Correction Questions Answered
Bitcoin (BTC) is showing signs of a pullback after hitting its latest all-time high (ATH) of $124,533. Currently trading around $113,800, BTC has dipped 1.5% this week despite rising volumes. The long-term bullish trend remains intact, but short-term exhaustion suggests potential consolidation or further correction. Key levels to watch include support at $111,900 and resistance at the ATH. Institutional sentiment is mixed, with ETF outflows and elevated funding rates hinting at cautious optimism. This analysis dives into the technicals, derivatives data, and market psychology shaping BTC’s next move.
What’s Driving Bitcoin’s Current Price Action?
Bitcoin’s retreat from its ATH reflects profit-taking after a relentless rally. The crypto king now faces a critical juncture: either rebound from key supports or extend losses toward $105,000. Weekly volumes spiked 34% to $48B, signaling strong participation even during the dip. The BTCC research team notes, "This isn’t panic selling—it’s healthy digestion after a 28% monthly pump."
Bitcoin Technical Indicators: Bullish or Bearish?
The SMA 200 ($98,300) and SMA 50 ($107,400) confirm the macro uptrend, but the SMA 20 ($114,700) has flatlined. RSI hovers at 54, neither overbought nor oversold. "We’re seeing textbook reaccumulation," says TradingView analyst CryptoHugo. "Think of this as a pit stop before the next leg up."
| Key Levels | Price | Significance |
|---|---|---|
| Resistance 1 | $124,533 (ATH) | Previous peak, sell wall |
| Support 1 | $111,900 | 20-day liquidity zone |
| Support 2 | $107,400 | SMA 50 + psychological level |
Derivatives Data Tells a Contradictory Story
Open interest dropped 12% since the ATH (Coinmarketcap), yet funding rates stay positive. "It’s a tug-of-war," notes BTCC’s lead derivatives trader. "Shorts are piling in at resistance, but longs aren’t surrendering." Liquidation heatmaps show clusters at $119,750-$123,050 (short squeezes) and $105,000-$107,000 (long squeezes).
Market Sentiment: From Greed Back to Fear
The Crypto Fear & Greed Index flipped from 76 (Extreme Greed) to 42 (Fear) in 10 days. ETF flows turned negative for the first time since June, with $240M in outflows (Farside Investors). Retail interest? Still buzzing—Google searches for "Buy Bitcoin" hit a 3-month high.
Two Possible Scenarios Ahead
Hold above $111,900 → retest ATH → target $132,815 (+17%)
Break below $111,900 → test $105,200 → risk $100,000 (-12%)
FAQs: Your Bitcoin Correction Questions Answered
Is this Bitcoin dip a buying opportunity?
Historically, post-ATH pullbacks of 10-15% precede rallies (see 2021 and 2024). Dollar-cost averaging into support zones may mitigate risk.
Why are ETF flows negative if the trend is bullish?
Institutions often take profits during volatility. The 30-day ETF inflow streak was due for a breather.
When could Bitcoin resume its uptrend?
Watch for a daily close above $117,000 with rising volumes—that’d signal renewed momentum.
