Bitcoin faced a significant dip today, dropping to an intraday low of $117,914 as $47.5 million in liquidations hit the market. Despite this, the overall bullish structure of the cryptocurrency remains intact.
Why did BTC price dip today?
The price of Bitcoin took a hit as it entered a high-liquidity zone between $118K and $119K, which was filled with leveraged long positions. These positions were essentially large bets made by traders who were expecting the rally to continue. Many of these positions were entered hastily, driven by FOMO after Bitcoin’s sharp rise from $115K to nearly $120K last week.
However, when the price failed to break higher and instead slipped into this zone, these long positions started getting liquidated automatically. This triggered a wave of forced selling, pushing the price lower. According to data from CoinGlass, if the downside pressure continues, Bitcoin could slide further into the $118K range, where more vulnerable long positions are exposed.
BTC bulls have been struggling to reclaim $119,000 after multiple failed attempts to breach this resistance zone in recent weeks. Each time there is an intraday attempt to reach $119K, it is met with sharp sell pressure due to automated liquidations and short re-entries.
Is the Bitcoin bull run over?
Despite the recent dip, analysts believe that Bitcoin still has room to run before hitting a cycle top. The MVRV ratio, which compares Bitcoin’s current market price to the average cost basis of all coins, is approaching levels that have marked major tops in the past. While the second MVRV peak may land in September, there is caution that a reversal could occur as early as late August.
For the BTC rally to continue, analysts emphasize the importance of a decisive break above the $119,500 resistance level. A confirmed weekly close above this level could trigger a rally towards $135,000 in the coming weeks.
This potential momentum could be supported by improving macroeconomic sentiment as the U.S. engages in new stages of trade negotiations with key partners. Additionally, any dovish tone from the Federal Reserve, which is set to meet soon, or signs of potential rate cuts later this year could boost risk sentiment and provide short-term upside for Bitcoin.
In conclusion, while Bitcoin faced a dip today, the broader bullish structure remains intact, and analysts are optimistic about the potential for a continued rally in the coming weeks.