Bitcoin (BTC) prices weakened sharply after the Wall Street opening Monday, trading below $105,000 and triggering concerns among analysts who warned of a potential “rug pull” around the $104,000 mark. Simultaneously, the traditionally anti-correlation US dollar showed signs of a potential recovery.

Fresh BTC Weakness and Order Book Concerns

Data from Cointelegraph Markets Pro and TradingView indicated BTC/USD hit an intraday low of approximately $104,401 after the US market opened. A string of eleven consecutive red hourly candles on the BTC/USD chart kept bulls firmly in check.

Order book analysis highlighted concerning liquidity shifts, with Material Indicators describing the action as indicative of manipulation:

This is what manipulation looks like in the $BTC order book. If price breaks below $105k, be prepared for a rug pull at $104k. (Material Indicators/X)

Order book liquidity “spoofing,” a common phenomenon in crypto markets where large traders aim to influence price, was observed during the decline.

Bulls Face a Critical Test

Despite the volatility and geopolitical pressure, trader Skew noted a surprising restraint among Bitcoin traders compared to previous market pullbacks.

Volatility is nonetheless on the horizon. … For a 3% or so pullback so far market isn’t panicked yet, although on LTF [long-term] there’s clear hedge bias. Previous dips were 5% or so but had aggressive shorting, spot selling & uptick in volatility with sell momentum/Volume. This means the big move has yet to occur & is brewing. (Skew/X)

If bulls succeed in pushing prices back above $108,000, Skew suggested the door to $110,000 could open.

US Dollar Shows Potential Comeback

While gold prices fell and crypto markets experienced volatility, a “deeply oversold” US dollar raised hopes for a comeback. The US Dollar Index (DXY), which typically moves inversely to Bitcoin, was staging a recovery from multiyear lows.

Asset managers are heavily short on the USD. The last time positioning was this bearish, the DXY staged a notable rally. Additionally, the index is trading near a key support level, and the RSI (14) is deeply oversold, showing signs of bullish divergence. (Guilherme Tavares/X)

Geopolitical Calm Prevails?

Trading resource The Kobeissi Letter dismissed speculation of a wider global conflict, noting:

Gold is strong, it continues to paint a consistent narrative: We are not on the brink of World War 3. Oil prices are up ~2% today despite ongoing attacks between Israel and Iran. Meanwhile, the 10Y Yield is nearing 4.50%. Markets say this won’t be a long-term headwind. (The Kobeissi Letter/X)

The article does not contain investment advice or recommendations. Every investment and trading move involves risk.