Bitcoin price today experienced a sharp pullback after briefly touching $123,000, leading to over $800 million in long liquidations across the crypto markets. While analysts caution of potential near-term weakness, they maintain that the overall uptrend remains intact.
The world’s largest cryptocurrency surged above its major horizontal range before encountering significant selling pressure. This rejection pushed prices back toward the midpoint of the range, a crucial level that many traders are closely monitoring to determine the sustainability of the rally.
According to one analyst, “The market absorbed liquidity above recent highs and quickly rejected it. Greed was evident, and traders failed to take profits at resistance.”
Bitcoin Price Forecast
Despite the short-term bearish momentum indicated by the asset posting its first lower low in weeks on the one-hour chart, Bitcoin continues to maintain an uptrend on higher timeframes, consistently forming higher highs and higher lows.
Key technical levels to watch include:
– Resistance at $120,000, marked by the value area high and anchored VWAP. A sustained recovery above this level would confirm renewed strength.
– Immediate Support at $118,200, the point of control where the heaviest trading volume has accumulated.
– Major Support at $116,300, a critical zone that combines the golden Fibonacci pocket, daily support, and the 200-day exponential moving average.
“This alignment of factors makes $116,000 to $117,000 a critical zone for Bitcoin,” the analyst emphasized.
Sentiment and Risk
Momentum indicators present a mixed picture, with the four-hour chart showing a hidden bullish divergence on the RSI, suggesting a potential rebound. However, the daily chart signals bearish divergence, hinting at the possibility of a larger corrective phase.
In addition to Bitcoin’s price action, Ethereum, the second-largest cryptocurrency, has also displayed signs of volatility. While it may aim for a new all-time high, traders are bracing for potential liquidity-driven reversals at elevated levels.
If Bitcoin manages to hold the $116,300 support level, a move back toward $120,000 is anticipated, with a potential extension to $128,000. On the other hand, failure to sustain support could trigger a more extensive retracement, potentially signaling the beginning of a corrective wave following months of gains.
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