Bitcoin is consolidating between $116,000 and $120,000 after a sharp breakout in early July. The market has entered a sideways phase as bulls and bears test control. Traders are closely watching the $116K support for clues on Bitcoin’s next move.
According to crypto analyst Kevinn Nguyen, the $116,000 level is now critical. He explains that if this support holds and volume increases, Bitcoin could break above resistance, continuing the bullish momentum seen earlier this month.
Nguyen also highlights the possibility of Bitcoin pushing toward the $124,000 level, with some long-term bulls projecting even higher seasonal targets of up to $250,000.
Notably, Bitcoin began the month with a sharp move to the upside, breaking above key resistance levels and reaching a new all-time high above $123,200.
Since then, price action has slowed, with BTC trading within a narrow horizontal channel. As of this press time, Bitcoin trades at $118,100, a 0.4% decline in the past day, reducing the monthly uptick to 11.3%.
Technical Indicators Signal Accumulation
On the 4-hour chart, the cryptocurrency has been oscillating between $116,000 and $120,000 for over a week. This range has become a key battleground between buyers and sellers.
Each test of the $120,000 resistance has resulted in rejection, while support at $116,000 has held firm on several occasions. The price is currently hovering near the mid-range, awaiting a catalyst for the next move.
Technical analysis reveals that the 34-period and 89-period exponential moving averages (EMA34 and EMA89) support the current structure. These indicators have flattened, reflecting reduced volatility but also suggesting accumulation.
The repeated bounce from the lower end of the range indicates buyer interest. However, the lack of follow-through past $120,000 highlights market hesitation.
The Next Big Move
Nguyen believes that if Bitcoin confirms a breakout above $120,000 with strong volume, a push toward $124,000 is likely. However, a breakdown below $116,000 could weaken the bullish setup and open the door to further downside toward the $112,000–$113,000 region.
Despite recent resistance, buyers appear to be defending the lower end of the range, hinting at a potential upside continuation. Still, the pattern suggests traders watch for confirmation signals, as false breakouts can occur in sideways markets.
The current consolidation reflects a breather phase as the market digests recent gains. A decisive move in either direction could set the tone for Bitcoin’s next trend. Despite this, Nguyen maintains a more bullish outlook.
What is the Next Bitcoin’s Move?
Market watcher Cas Abbé noted that Bitcoin is rapidly exiting long positions while short positions are increasing. He mentioned the shift is due to Bitcoin trading sideways and traditional stocks hitting new highs.
Abbé said the pattern suggests a potential short squeeze, where a sudden price surge could force short sellers to cover their positions, driving prices higher.
A previous similar setup on the chart led to a sharp price spike from around $112,000 to over $118,000, reinforcing the possibility of a breakout if bearish traders get caught on the wrong side.
Additionally, data from Coinalyze shows that 57.09% of traders hold long positions on Bitcoin, compared to 42.91% holding shorts, resulting in a long/short ratio of 1.33. This indicates a clear bullish bias in the market, with more traders expecting further upside.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
