Bitcoin just completed what many traders are referring to as the largest fakeout of Q4, 2025. The rally attracted traders with bullish momentum, but it quickly fell back under important moving averages. The short-term uptrend that began earlier this quarter was essentially ended by the recent rejection at $116,000, and the subsequent pullback to the 50-day EMA, which represents a significant technical turning point.
Rejection
Bitcoin seemed to be regaining its footing after decisively breaking above the 50 EMA in early October, indicating another push toward its annual highs close to $125,000. However, that optimism was short-lived. The $115,500-$116,000 range, which had been serving as resistance since late August, is where the rejection candle formed.
The subsequent sell-off and an increase in sell-side volume now make it more likely that Bitcoin will return to the $108,000 range, which is where the 200 EMA is currently located. Between the 200 EMA and the 100 EMA (orange), which serve as compression zones for volatility, Bitcoin is currently caught between a rock and a hard place.
Bitcoin’s consolidation mode
Bitcoin typically remains in consolidation mode for weeks, or even months, when it is trapped between these two important moving averages before a decisive move either resumes the trend or breaks it entirely. Despite earlier bullish momentum, the RSI is currently hovering around 42, a neutral but slightly bearish reading that indicates the absence of buying pressure.
Volume has also decreased since the decline, indicating that traders are holding off on reentering the market until it exhibits more defined direction. Bitcoin could potentially destroy the $100,000 psychological level and cause a chain reaction of liquidations if it breaks below the $110,000-$108,000 support zone.
Though the road back to $120,000 now appears much steeper than it did previously, Bitcoin may stabilize if bulls successfully defend this range and retake the 50 EMA. As of right now, the fakeout serves as a sobering reminder that even the most robust rallies in the Bitcoin market can implode at any time.