Bitcoin Faces Resistance at $116K, Risk of Decline Below $110K

Bitcoin’s recent price action reveals a cryptocurrency caught in a technical tug-of-war between bullish recovery attempts and persistent bearish pressure. After correcting losses and trading above the $115,000 level, BTC now faces significant resistance that could determine its near-term trajectory. The failure to clear the $116,000 resistance level triggered a fresh decline, leaving the digital asset trading below $115,000 and beneath the 100-hour Simple Moving Average – a key technical indicator watched by traders.

The technical landscape shows a bearish trend line forming with resistance at $118,250 on the hourly chart of the BTC/USD pair, using data feed from Kraken. This developing pattern creates additional overhead pressure for Bitcoin bulls attempting to push prices higher. Immediate resistance now sits near the $114,000 level, with the first key resistance at $115,000 and the next critical barrier at $116,000. A close above this $116,000 resistance zone could potentially send the price higher to test the $117,200 resistance and the 76.4% Fib retracement level of the downward move from the $122,498 swing high to the $100,000 low.

Bitcoin’s recent recovery wave saw the cryptocurrency climb above several resistance levels, including $112,000, $112,500, and $113,200. The price even managed to surpass the 61.8% Fib retracement level of the downward move from the $122,498 swing high to the $100,000 low, demonstrating some underlying strength. The bulls successfully pushed BTC above the $115,000 resistance level, but the momentum proved unsustainable against the weight of multiple technical hurdles.

Despite these recovery efforts, Bitcoin remains trapped below crucial technical levels that typically signal bullish momentum. The combination of trading below $115,000 and the 100-hour Simple Moving Average creates a challenging environment for sustained upward movement. Any further gains would need to overcome the $117,250 level, with the next significant barrier for bulls positioned at $118,500. The technical setup suggests that while recovery attempts are possible, each upward move faces increasingly difficult resistance levels that could limit upside potential.

The technical indicators paint a concerning picture for Bitcoin’s near-term prospects. The Hourly MACD (Moving Average Convergence Divergence) is now gaining pace in the bearish zone, suggesting increasing downward momentum. Meanwhile, the Hourly RSI (Relative Strength Index) for BTC/USD sits below the 50 level, indicating weakening buying pressure and potential for further declines. These combined signals point to growing bearish sentiment among traders and investors.

If Bitcoin fails to rise above the $116,000 resistance zone, it could initiate another decline with immediate support near the $111,800 level. The first major support sits at $110,500, followed by additional support near the $110,200 zone. A break below these levels could send the price toward the $108,500 support in the near term, with the main support positioned at $107,000. Below this $107,000 level, Bitcoin might struggle to recover in the short term, potentially signaling a more significant correction.

The current technical analysis suggests that Bitcoin’s path of least resistance appears downward in the immediate future. With major support levels identified at $111,800 and $110,500, and resistance clustering between $114,000-$116,000, the cryptocurrency faces a critical juncture. Traders are closely watching whether BTC can hold above key support levels or if bearish momentum will push prices toward lower support zones, potentially testing the $108,500 or even $107,000 levels in the coming sessions.