Bitcoin has experienced significant price fluctuations recently, largely influenced by ongoing global uncertainties, particularly due to heightened tensions between Israel and Iran. Following a nearly 5% decline amid these geopolitical tensions, Bitcoin rebounded, rising above $105,000 and is currently trading around $106,800. In the past 24 hours, Bitcoin briefly approached $108,000 again, but given the escalating situation in the Middle East, there is a strong possibility of another downturn. A crypto analyst has suggested that Bitcoin could potentially drop to $100,000.
Bitcoin is currently testing a critical resistance band, as highlighted by crypto analyst Pejman_Zwin on the TradingView platform. The cryptocurrency is trading within a confluence of resistance and short liquidation zones, specifically between $105,330 and $107,120. This area not only represents structural resistance but also coincides with the cumulative short liquidation leverage zone. The analyst warns that this setup indicates a high likelihood of increased price volatility if this range is breached.
The charts indicate a potential bearish continuation pattern known as a contracting triangle, which could lead to a larger market correction. If Bitcoin fails to convincingly reclaim the $106,600 mark, the market structure could shift from a corrective triangle to a five-wave downward impulse, suggesting a deeper price retracement, especially as lower highs are forming within the triangle. The longer Bitcoin remains within this resistance range without breaking out, the greater the risk of a rapid decline.
If a breakdown occurs, the analyst identifies the first major target near the lower boundary of the support zone, which is between $105,330 and $103,162. This area is supported by the monthly pivot point and coincides with the cumulative long liquidation leverage region. Additionally, analysis of the 1-hour candlestick chart reveals a potential short setup from the reversal zone near $107,100, with a projected target around $104,300. Should liquidation pressures continue, further declines could see Bitcoin drop to the next support band near $102,600 or even as low as $101,000.
Conversely, Pejman notes that a sustained breakout above the $107,120 resistance level could signal a bullish reversal, potentially pushing Bitcoin back toward the significant resistance cluster above $108,000. A strong daily close above this threshold could negate the bearish outlook. However, if Bitcoin fails to break through, it may face rejection and another downturn. Despite showing signs of bullishness, Bitcoin's price action remains susceptible to a rapid pullback, especially if tensions in the Middle East persist. As of now, Bitcoin is trading at $106,638, reflecting a slight decrease of 0.02% over the past 24 hours, indicative of its current consolidation phase.
