Bitcoin’s Golden Line Test: Analyst Warns Major Breakdown Looms

Bitcoin’s 4.5% surge in the past day, pushing it back above $106,500, comes amid growing optimism that Washington’s shutdown standoff may finally be resolved. However, this short-term bullish momentum masks a potentially devastating technical setup brewing beneath the surface. The cryptocurrency is currently testing what analyst Doctor Profit calls the ‘Golden Line’ – a historic support level sitting around $99,200, just below the psychological $100,000 barrier.

This Golden Line has served as an unbreakable foundation throughout the current bull market that began in March 2023. On the weekly timeframe, Bitcoin has consistently bounced above this line and has never closed below it, making it one of the most essential bull-bear indicators in the current market cycle. Doctor Profit notes that while he has historically bought more Bitcoin at this level throughout the entire bull market with successful results, his approach has fundamentally changed this time around.

Despite Bitcoin’s recent bounce from the Golden Line, Doctor Profit maintains a macro bearish view and believes a breakdown below this critical level is ‘just a matter of time.’ The analyst confirmed he continues to hold short positions from the $115,000 to $125,000 region and has identified a large liquidity cluster around $116,000 to $117,000. If the market revisits that price region, he plans to add more to his short positions, anticipating that any move toward these levels represents a selling opportunity rather than a bullish breakout.

The analyst suggests that market makers are currently engineering manipulation moves designed to build liquidity to the downside before initiating the next leg down. ‘Market makers are setting trap after trap before the next leg down,’ Doctor Profit warned, advising traders to ‘enjoy your tea, wait, don’t over-trade.’ This cautious approach reflects his conviction that the current environment, characterized by heavily increased leverage particularly in long positions on altcoins, typically precedes a major market drop.

Matrixport’s analysis presents a more nuanced picture, noting that Bitcoin’s RSI recently dipped to 35 – historically a zone where tactical dip-buyers begin to re-engage. This technical setup coincides with near-term catalysts including comments from Donald Trump hinting at potential $2,000 stimulus-style payments to Americans and the potential resolution to the United States government shutdown. These developments could theoretically reignite risk appetite among investors.

However, Matrixport warns that these catalysts alone may not be sufficient to drive a lasting reversal. ETF data showing outflows over the past week indicates that institutional capital may be stepping aside for now, suggesting that larger market participants remain cautious despite the positive political developments. The combination of technical oversold conditions and fundamental catalysts creates a conflicting environment where short-term rallies could quickly fade, leaving retail traders vulnerable to the market maker traps described by Doctor Profit.

The current Bitcoin market sits at a critical juncture, with the Golden Line representing both historical support and a potential breaking point. While the resolution of Washington’s political standoff provides temporary optimism, the underlying technical structure and institutional behavior through ETF flows suggest that the path of least resistance may ultimately be downward. As leverage builds and market makers allegedly set their traps, traders face a landscape where any breakdown below $99,200 could signal the vanishing of bullish momentum that has characterized the market since March 2023.