Bitcoin Pullback Below $114K as Bears Challenge Rally

Bitcoin’s recent bullish momentum has encountered significant resistance, triggering a corrective phase that has seen BTC decline below multiple critical technical levels. After reaching a high of $116,309, the BTC/USD pair began losing ground, breaking below the $114,200 support zone that had previously served as a foundation for upward moves. The breakdown extended further with a breach of the bullish trend line that provided support at $114,050 on the hourly chart, signaling a potential shift in market sentiment from bullish to bearish in the short term.

The current price action places Bitcoin below both the $114,000 psychological level and the 100-hour simple moving average, two technical markers that traders closely monitor for directional bias. The correction has also pushed BTC below the 23.6% Fibonacci retracement level of the recent wave from the $106,718 swing low to the $116,309 high, indicating that the pullback has gained meaningful momentum. This technical deterioration suggests that the recent rally may have exhausted itself, at least temporarily, as buyers struggle to maintain control.

For Bitcoin to regain its bullish trajectory, it must overcome several resistance barriers that now stand in its path. Immediate resistance forms near the $113,650 level, with the first significant hurdle at $114,200 – the same level that previously served as support. The next critical resistance zone sits at $115,000, which represents a key pivot level that could determine the medium-term direction. A decisive close above $115,000 would likely reignite bullish momentum, potentially sending BTC toward the $116,200 resistance level and beyond to test $117,500.

On the downside, Bitcoin faces multiple support levels that could either halt the decline or accelerate it if broken. Immediate support is established near $112,000, with the first major support zone forming around $111,500. This level coincides with the 50% Fibonacci retracement level of the recent upward wave from $106,718 to $116,309, making it a technically significant area where buyers might re-enter. Below this, the next support forms at $110,500, with the $110,000 level representing a crucial psychological barrier. The main support sits at $108,500, below which BTC could struggle to recover in the short term.

The technical indicators for Bitcoin are currently flashing warning signs for bulls. The hourly MACD (Moving Average Convergence Divergence) is now gaining pace in the bearish zone, indicating that downward momentum is accelerating. This development suggests that selling pressure is intensifying and could potentially drive prices lower in the near term. The MACD’s bearish trajectory aligns with the price action that has seen BTC break below multiple support levels and trend lines.

Complementing the bearish MACD signal, the hourly RSI (Relative Strength Index) for BTC/USD has dropped below the 50 level, indicating that momentum has shifted from bullish to bearish territory. An RSI reading below 50 typically suggests that sellers are gaining control of the market, which could lead to further downside if the indicator continues to decline. The combination of these technical signals – broken support levels, bearish MACD, and RSI below 50 – creates a concerning picture for Bitcoin bulls in the short term.

The current market structure for Bitcoin presents a clear battle between bulls and bears, with critical technical levels defining the potential next moves. If BTC fails to reclaim the $114,200 resistance zone, the path of least resistance appears to be downward, with the $112,000 support level serving as the immediate test. A break below $112,000 would likely trigger further selling pressure, potentially pushing Bitcoin toward the $111,500 support and possibly lower to test the $110,000 psychological level.

Conversely, if Bitcoin can muster enough buying pressure to overcome the $114,200 resistance and subsequently clear the $115,000 hurdle, the bullish narrative could quickly regain dominance. Such a move would invalidate the current bearish technical setup and potentially propel BTC toward retesting the recent highs around $116,200. For now, traders are closely monitoring these key levels while the technical indicators suggest that the near-term risk remains skewed to the downside until proven otherwise by a decisive break above resistance.