Bitcoin Faces Third Consecutive Rejection at $110k Ticker; 14-18% Correction Implied

Key takeaways:

• Bitcoin (BTC) failed to reclaim the $110,000 resistance level for the third consecutive time.
• A significant drop below $110,000 suggests a short-term price target near $105,000.
• Multiple past rejections near all-time highs have historically preceded sharp pullbacks of 14-18%.
• Bulls face major supply concentration and weak technical indicators above $110,000.
• Bears aim to defend the $110k level, targeting key resistance zones below.
• A short squeeze remains a possibility if $110k is breached, potentially pushing prices towards $114k.
• A clear descent below $107,500 could signal a deeper correction.
• All investments involve risk; consult independent financial advice before making decisions.

Bitcoin Third Time Failing to Sustain $110k

Thursday’s attempt by Bitcoin bulls to reclaim the $110,000 support level encountered strong resistance following the release of better-than-anticipated US employment data. This outcome complicated expectations for imminent Federal Reserve interest-rate cuts before September.

This latest failure marks the third unsuccessful challenge by Bitcoin bulls to recapture the $110,000 pivot point since its May all-time high (ATH). This persistent rejection casts significant doubt on the cryptocurrency’s immediate prospects for breaching this psychological barrier and establishing new price discovery territory.

BTC Risks Deeper Correction Following Failed Tests

Historical data indicates that a pattern of sustained resistance near all-time highs often precedes substantial retracements in Bitcoin’s price.

In January (2025?), BTC was repeatedly rejected near the $107,000-$109,000 zone (a 2% discount to its January 20th ATH). This resistance preceded a notable 14% sell-off over the subsequent two-week period.

A similarly brief but sharp decline occurred earlier this year. Following multiple failed attempts to breach the $72,000-$73,000 resistance zone (awake the March 14, 2024 high), Bitcoin suffered a precipitous 18% drop over just ten days.

If the historical precedent proves relevant, market participants should anticipate a potential adjustment in BTC/USD ranging between 14% and 18% from current price levels, assuming the pattern holds.

Technical Indicators Signal Bearish Case

Current technical setup suggests the bulls are struggling against established resistance and facing distribution pressure.

Taker Sell Orders starting to rumble on this headline pic.twitter.com/ZJrr9qNflT

Key bearish technical signals dominating the current chart for Bitcoin include:

• Multiple Rejection Attempts: Failure to breach $110,000 three times in succession.
• Bearish Divergence: Falling price aligning with a lower high on the Relative Strength Index (RSI), signaling weakening momentum.
• Heavy Distribution: Evident from high-taker sell volume accumulation precisely around the $110,000 barrier.
• Flat Funding Rates: Neutral funding rates in the futures market suggest trader consolidation rather than strong bullish conviction.

Key Levels Under $110,000 Are Critical

Current market analysis centers on several crucial price levels below the persistent $110,000 hurdle:

Data indicates BTC/USD is currently trading near $109,100. A decisive breach above $110,000 would mark a significant turning point, ending an extended consolidation phase and reigniting potential for further gains, albeit stepping over a substantial supply zone from $110,000 to $112,000.

“Hold = I TP my short and aim for a sweep of ATH this month.”

The most immediate resistance battle occurs at the current $110,000 watermark. Should bears successfully contain price action near this level, further downside appears likely towards the converging 50-day Simple Moving Average near $107,500 and the crucial long-term $106,000 barrier shared by the 100-day and 200-day SMAs.

The most recent local low of $105,200 (touched on Wednesday) plus the psychological $104,000 zone represent increasingly significant defensive technical levels.

Analyst KillaXBT underscores that holding BTC above the $108,000-$107,500 support band is vital. Failure to hold this crucial support could negate any short-term recovery attempts and open the door for a deeper valuation compression.

Downside Risk Assessment

The market structure presents notable selling pressure below $110,000. A significant bid order book exists around the $108,000 price region, suggesting potential overhead resistance.

However, bearish ordering concentrations are also observed between $107,700 and $105,000, denoting another critical zone where substantial selling pressure is concentrated.

If the current consolidation near $110,000 fails and fails to close significantly above this threshold, price action appears predisposed to move towards the statistically significant support zones between $107,500 and $105,000.

Moreover, should volatility break down into the $107,500-$104,000 range, the possibility emerges for a short squeeze scenario if short sellers are compelled to cover their positions at lower levels. Conversely, if sentiment remains bearish and selling pressure holds, prices could fall towards the $105,000-$104,000 magnet.