Bitcoin Plunges Below $110K: Bullish Breakout or Major Correction Ahead?

Bitcoin's stunning retreat below the $110,000 threshold sends shockwaves through crypto markets.

The Technical Crossroads

Traders face a critical juncture as Bitcoin tests key support levels. The digital asset's sudden dip triggers both panic selling and opportunistic buying across exchanges.

Market Psychology at Play

Fear and greed collide as institutional investors reassess positions while retail traders scramble for direction. The volatility highlights crypto's relentless capacity for dramatic moves.

The Institutional Perspective

Wall Street's latest crypto darling shows its wild side again—proving that even six-figure price tags can't tame market forces that move faster than a hedge fund's risk management committee.

Will this dip become a buying opportunity or the start of a deeper correction? The charts don't lie, but they rarely tell the whole story either.

• Bitcoin trades at $109,225, falling 0.43% in 24 hours, with volume down 36.86% to $46.52 billion.
• Analysts expect Bitcoin to remain in consolidation, with $112K marking an uptrend and $107K a drop.
• RSI at 37.43 suggests oversold conditions, while MACD confirms continued bearish momentum for Bitcoin.

Bitcoin (BTC) is currently trading at $109,225 reflecting a fall of 0.43% in the last 24 hours. cryptocurrency has experienced a notable decline in trading volume, down 36.86%, and is now standing at $46.52 billion. In the last seven days, the Bitcoin price has declined by 5.63%, continuing to push it even lower.

Source: CoinMarketCap

Analysts are still wary because Bitcoin is exhibiting a lack of volatility. The weekend is near, and there is no hope of significant price changes. Bitcoin may experience short-term consolidation or slight price and trade volatility following the continually decreasing price and trading volumes.

Bitcoin’s Key Breakout Points at $112K and $107K

Popular analyst Ted Pillows highlighted that bitcoin is trading at about $109,000. He highlighted two levels to monitor: $112,000 and $107,000. In the event that Bitcoin surges past $112,000, this might mark the beginning of an upward trend. Nevertheless, a fall to below the lower side of $107,000 could result in a more pronounced adjustment. This implies that BTC is under a stage of consolidation, with traders waiting to get a clear indication in the market.

Source: X

Another analyst, Man of Bitcoin, mentioned that Bitcoin is trading sideways and not yet showing any power. He proposed that the current market structure be maintained, ensuring Bitcoin remains above $107,284. When the price is below this point, then more negative shifts WOULD follow. This trading behaviour depicts a sign of indecision in the market, with buyers not being sure where the market will go in the days ahead.

Source: X

RSI and MACD Indicate Bearish Momentum for BTC

The Relative Strength Index (RSI) is 37.43, suggesting that the cryptocurrency is in oversold conditions. The RSI of less than 50 indicates poor momentum and is consistent with the bearish forecast of cryptocurrency. However, if BTC receives support, this oversold state could potentially pave the way for a future rise. Any increase to 50.36 and above would be a sign of increased buying interest and a change in market flows. 

The Moving Average Convergence Divergence (MACD) indicates a negative value of -51, indicating a buy pressure. The bearish trend is additionally reinforced by the MACD line, which indicates that the value of the signal line is below that of the MACD line at -785. The MACD histogram remains red, indicating the continuation of the downward trend. 

Source: TradingView

Open Interest and Volume Drop Indicate Caution

According to the CoinGlass data, the trading volume has declined by 47.92% and now stands at $60.96 billion. This fall is evidence of a reduction in general market activity, suggesting lower turnover by traders. Besides the reduced volume, the Open Interest has also reduced by 0.85% to the current level of $77.48 billion.

Source: CoinGlass

Moreover, the BTC OI-Weighted Funding Rate is at 0.0028%, which indicates that there is no significant market pressure due to Leveraged positions. These signs indicate a slower start of a market, where players are waiting until they realize there is a definite wave before they make any meaningful move.