Bitcoin has experienced a small retracement after reaching a record high of $123,000. Although the overall trend remains positive, there is a shift in short-term sentiment as more selling pressure starts to develop. The bulls have now taken up key levels of support, and the $117,000 area is emerging as an important line which could decide whether or not the trend continues.
Related Reading
This pullback brought new uncertainty to the market. CryptoQuant has released new data that shows Bitcoin Futures Position Dominance to be leaning towards the bearish. Short positions appear to be gaining momentum in major derivatives exchanges. The shift in sentiment reflects a growing level of caution on the part of traders as they become more cautious, especially after the long-to short ratios have weakened and funding rates are normalizing following weeks with high bullish activity.
The current pause, even though Bitcoin is still far above the 2024 highs, and that the macro-structure favors bulls despite the fact that it remains well over the previous peak of the year in question. Investors They are waiting for confirmation that this recent high is not just a temporary peak. Coming days will be critical, with fear creeping up and early warnings from the derivatives market. Whether bulls can hold the line—or whether bears take control—will likely set the tone for Bitcoin’s next major move.
Bitcoin Retraces As Bearish sentiment Rises
Bitcoin’s price has fallen more than 5% from its recent high of $123,000. The current action is testing short-term levels of support. Retracements after big breakouts are not uncommon, but some analysts have noted that Bitcoin’s fall has been more dramatic than Ethereum or many other altcoins which either held ground or continue to rise.
Axel Adler, a top analyst at ATH, noted a major shift in the sentiment after the ATH. According to his insightsThe bears immediately began shorting the stock after it reached its peak. This led to an abrupt drop in bullishness. The most notable change was that the ratio of longs to shorts shifted into the negative for the first week, signaling an increase in the interest in derivatives.
The shift in position reflects a growing level of caution by traders, and increases the stakes for bulls. The $117,000 level is now seen as a key support zone—if Bitcoin fails to hold above it, a deeper correction could follow, potentially dragging the broader market down with it.
It is important to get the timing right. The US Congress begins this week. “Crypto Week,” Discussions and votes could be held on key legislation, which would reshape regulatory frameworks for digital assets. The outcome of these debates may act as a catalyst for renewed bullish momentum—or deepen the correction if uncertainty dominates. While markets wait for clarity, attention is focused on Bitcoin and its ability to hold $117K or regain the short-term trend.
Related Reading
BTC Pulls Back: $114K–$117K Key Zone to Watch
Bitcoin’s 4-hour chart shows a sharp retracement after hitting an all-time peak of $123,200 this week. BTC is currently trading at $116.900. This marks its first major correction since it broke above $109,300.
This pullback brings Bitcoin back toward the $114,000–$117,000 zone, which now acts as short-term support. The area is aligned closely with the prior breakout and coincides exactly with the 50-period rising simple moving average. If this level is successfully tested again, it could serve as the base for a new upward trend.
Related Reading
If this area is not held, it could lead to a more severe correction towards the support level of $109,300, which was a strong resistance for several weeks in May and June. A combination of the bearish trend on recent candles and high selling volume reflects a growing short-term level of uncertainty. Bitcoin is above the 50, 100 and 200 SMAs, indicating that there’s still a trend.
Featured picture from Dall E, chart by TradingView
“This article is not financial advice.”
“Always do your own research before making any type of investment.”
“ItsDailyCrypto is not responsible for any activities you perform outside ItsDailyCrypto.”
Source: www.newsbtc.com
