Bitcoin Price Analysis: Navigating Market Consolidation
Bitcoin (BTC) currently trades near a key support level at $104,000. Weak trading volume, declining on-chain metrics, and persistent inflation suggest continued price consolidation. Recent volatility triggered significant liquidations in the derivatives market. Glassnode data shows $28.6 million in long positions and $25.2 million in shorts were liquidated within 24 hours, reflecting extreme market sentiment shifts.
Market Dynamics and Key Trends
- BTC open interest fell ~7% to 334,000 BTC
- Declining profitability metrics and subdued user activity
- Market appears to be absorbing recent gains while awaiting new demand
Technical Perspective
Bitcoin’s inability to test liquidity near $109,000 resulted in gradual declines on 4-hour charts. Price action remains constrained within a descending channel, with $103,400-$104,600 forming a critical zone. This area aligns with a daily fair value gap and finds support at the 200-day EMA.
Macroeconomic Factors
Core inflation rose to 2.7%, reducing expectations for Federal Reserve rate cuts. The Fed’s preferred PCE inflation metric reached 2.3%, while Core PCE exceeded forecasts at 2.7%. These conditions maintain pressure on risk assets like Bitcoin.
Expert Commentary
“We’re seeing a market reset,” notes a Glassnode analyst. “Without stronger demand signals or improved on-chain activity, consolidation appears likely to persist.”
