Bitcoin has faced a sharp rejection after sweeping liquidity above a critical resistance zone. The price is now pressing into major support levels, where buyers may attempt to defend the broader uptrend.
Technical Analysis
By Shayan
The Daily Chart
On the daily timeframe, BTC was rejected decisively after sweeping above $117K, triggering a swift selloff into the highlighted support area. The decline pushed the asset slightly below the 100-day moving average near $113K, a level that has repeatedly served as a market pivot in recent months.
If this zone holds, Bitcoin could stage a rebound toward $117K, but a deeper retracement into the $108K–$110K range remains more likely. This area aligns with both the rising trendline and the prior major swing low, making it a critical battleground for bulls to defend.
The 4-Hour Chart
The 4-hour structure clearly illustrates the liquidity sweep above $117K, followed by a breakdown of the ascending trendline, a clear shift in short-term momentum. The selloff has driven the price toward the demand zone around $110K, where market participants now face a key decision point.
A strong bounce here could reset bullish momentum and keep the broader structure intact. However, failure to hold $110K would expose the liquidity pool below $107K, making it the next likely target if selling pressure accelerates.
On-chain Analysis
By Shayan
The liquidation heatmap confirms that the recent selloff was driven by a long squeeze. As Bitcoin advanced into the $117K–$118K zone, excessive long positioning built up. Once price failed to sustain above this liquidity cluster, a wave of liquidations was triggered, accelerating the decline.
The cascade cleared leveraged longs and flushed price into the $110K–$112K region, where fresh liquidity clusters are now forming. This confirms that the breakout above the swing high was not sustainable, but rather a liquidity trap that fueled downside momentum.
Broadly, the market continues to rely on liquidity events to drive sharp moves. Long squeezes, like the one just witnessed, act as catalysts for aggressive corrections. At the same time, the heatmap highlights resting liquidity beneath current lows, which could attract price if downside pressure persists.
For bulls, the key question is whether this purge has sufficiently reset leverage to allow for a more stable rebound. If demand returns around the $110K base, Bitcoin may attempt another recovery leg. Until open interest normalizes, however, the market remains vulnerable to further squeezes and volatility.
