Bitcoin has recently experienced a pronounced corrective phase, declining by more than 2.5% in the last 24 hours amid significant selling pressure. This downturn follows a major liquidation event primarily instigated by large institutional sell-offs, leading prices to fall below key short-term support levels. With July’s monthly close approaching, Bitcoin’s struggle to reclaim momentum above the $118K mark increases concerns about a more substantial pullback. If bearish trends persist, Bitcoin could potentially drop toward the $112K–$110K range before finding stabilization.
This raises the pivotal question: will Bitcoin manage to trigger a rebound back above $119K prior to the end of the month? Such a move is essential for any hopes of a recovery toward the $124K to $126K range.
Why is the BTC Price Declining?
Over the past 24 hours, Bitcoin has seen a nearly 3% decline due to a surge in selling pressure. This sudden price drop is attributed to a combination of unfavorable macroeconomic conditions and specific pressures within the cryptocurrency market. A critical factor contributing to this downturn is the renewed hawkish stance from the U.S. Federal Reserve. With expectations of interest rate cuts now being pushed further out, Bitcoin’s attractiveness has diminished, prompting investors to explore alternative investment options.
Additionally, institutional players have been offloading their holdings, leading to fresh outflows from Bitcoin exchange-traded funds (ETFs). At the same time, whale wallets are witnessing an uptick in inflows, typically indicative of impending sell-offs. The plummet in price has triggered a wave of liquidations, particularly affecting long positions, which has further amplified the decline. Therefore, should the selling pressure persist, Bitcoin is at risk of testing the $112,000 to $110,000 support zone, while a recovery above $118,000 remains crucial.
What Can We Anticipate Regarding the Bitcoin (BTC) Price Rally This Week?
After several days of consolidation around the crucial resistance level of $118,500, Bitcoin’s price has sharply dipped below the immediate support around $115,500. This retracement has pushed the price beneath a crucial range, posing significant challenges for any potential recovery. Continued upward momentum could lead Bitcoin into a key support zone in the coming days.
The recent narrowing of the Bollinger Bands, after remaining expanded for most of the month, indicates a decline in trading volume and volatility. An extended squeeze here could enforce a continued downward consolidation pattern. Additionally, the recent drop in the Relative Strength Index (RSI) signals a weak rally, while the Chaikin Money Flow (CMF) and On-Balance Volume (OBV) indicators moving southward affirm bear market dominance.
This coming weekend may bring crucial developments for Bitcoin’s price trajectory. Current chart patterns suggest a balance of potential bullish and bearish outcomes. If Bitcoin can reclaim the $118,000 level, an ascension past $120,000 is plausible. Conversely, failure to defend the $110,000 support level might catalyze a more severe correction.
