Bitcoin Rally Will ‘Continue Higher’ Regardless of Drop to $122K

Key takeaways:

• Bitcoin dropped to $122,500 on Tuesday, however onchain knowledge exhibits no indicators of an overheated market.

• The resistance at $135,000 stays the primary BTC worth barrier for now, with key assist round $120,000.

Market analysts stated Bitcoin’s upside remained intact regardless of the 1.7% correction from its all-time high of $126,200 reached on Monday.

Bitcoin to see a “small pullback” before continuing higher

“BTC has been in an up-only mode,” with the price printing just one red candle in the past 11 days,” said analyst Mags in an X post on Tuesday. 

The BTC/USD pair is taking a small pullback in lower time frames toward the key support level at $123,300.

A daily candlestick close above this level could see Bitcoin “continue higher,” the analyst said, adding that the failure to hold this support could see a retest of the $120,000 zone. 

“Overall, dips are for buying, and the next resistance is near $135,000.”

MN Capital founder Michael van de Poppe said Bitcoin is consolidating around the all-time high, adding:

“It’s increase stamina for the next big breakout toward $150K.”

An accompanying chart confirmed that the $118,500-$120,500 zone can be an “optimal entry point” within the occasion of a correction.

As Cointelegraph reported, Bitcoin could consolidate within a narrow range between $122,000 and $124,000 over the next few days as it builds momentum to break higher into price discovery. 

Bitcoin’s worth momentum is accelerating

Personal wealth supervisor Swissblock acknowledged that Bitcoin’s upward momentum stays sturdy, regardless of the slight correction from document highs.

Swissblock shared a chart revealing a “rare” setup the place the most recent rally noticed Bitcoin worth momentum break via resistances with out main corrections. 

“Momentum is igniting at resistance, not fading from it.”

“Nevertheless, a bit of short-term friction is needed to build deeper acceleration,” Swissblock added.

Echoing this observation, onchain data provider Glassnode pointed out that Bitcoin’s relative strength index (RSI) has elevated to 66 from 44 over the past seven days, indicating a 50% rise in upward momentum.

This displays a “stronger buying momentum and growing market confidence,” Glassnode wrote.

Associated: Gold rally implies $644K per Bitcoin in ‘equivalent value’ — VanEck

In the meantime, spot demand is accelerating with spot cumulative quantity delta (CVD) turning constructive and rising to $68.7 million from -$73.6 million over the past week.

Buying and selling quantity on centralized exchanges additionally elevated by 32% to $9.27 billion, from $6.99 billion, over the identical interval.

Glassnode added:

“The rise supports recent price momentum, suggesting stronger investor engagement and confidence. Although, maintaining this elevated activity will be key to sustaining the uptrend.”

Onchain data reveals key Bitcoin price levels to watch

Looking at Bitcoin’s short-term holder (STH) price foundation reveals that the STHs are nonetheless lively and never exhausted.

STH price foundation refers back to the common buy worth of traders who’ve held Bitcoin for lower than 155 days.

The value touched the “heated” band of this metric on July 14, when it hit its earlier all-time high of $123,200, however didn’t enter the overheated zone. 

If it rises to retest the higher band — matching the one commonplace deviation above the STH realized worth — it might hit recent all-time highs at $133,460.

Greater than that, the following resistance is the “over-heated” band at $150,000 — matching the 2 commonplace deviations above the STH realized worth. 

This implies there’s nonetheless room for growth earlier than we see any panic promoting or euphoria.

On the downside, the first major support sits at $113,300, representing Bitcoin’s STH realized worth. 

This worth band has traditionally served as a significant assist stage, as seen between April 6 and Sept. 25, in addition to through the October 2024-January 2025 rally.

This text doesn’t include funding recommendation or suggestions. Each funding and buying and selling transfer includes danger, and readers ought to conduct their very own analysis when making a call.