Can Bitcoin Defend $105K or Will It Drop to $90K Next?

Bitcoin’s price has entered a critical phase as it tests the $105K level, a psychological and technical fulcrum that could determine whether the asset enters a deeper correction or initiates a bullish rebound. This analysis synthesizes technical and on-chain data to evaluate the defendability of $105K and identify tactical entry/exit points for investors.

Technical Analysis: A Bearish Tug-of-War

Bitcoin’s immediate support lies at $105K, with a secondary level at $100K [1]. The Relative Strength Index (RSI) currently sits at 62, indicating neutral momentum, while the MACD line at -639.18 signals bearish pressure [3]. A breakdown below $107K could trigger a cascade toward $90K–$95K, as short-term sellers capitalize on weak hands [5]. Conversely, stabilization above $105K may retest the $113.5K resistance level, validating a bullish flag pattern [6].

The 20-day EMA at $106,028 and the 200SMA at $101K are critical moving averages to monitor. A close above the EMA could reignite bullish sentiment, while a sustained drop below the 200SMA would confirm bearish control [1]. On the 4-hour chart, bullish divergence suggests buyers are stepping in near $111.8K–$112K, but this remains untested against aggressive shorting [6].

Historical backtests of Bitcoin’s MACD Death Cross events since 2022 reveal a mixed but cautionary pattern. On average, post-death-cross returns over 30 trading days showed a -12.3% decline compared to a flat or positive return for a passive buy-and-hold strategy [3]. The hit rate—defined as the percentage of events followed by a price drop—was 68%, with cumulative losses exceeding $15B in three major 2023–2024 bear cycles [1]. These findings underscore the MACD Death Cross’s historical reliability as a bearish signal, though exceptions occurred during periods of strong macro tailwinds (e.g., 2024 halving-driven rallies).

On-Chain Metrics: Mixed Signals for Institutional Buyers

On-chain data reveals a tug-of-war between speculative selling and institutional accumulation. The Network Value to Transactions (NVT) ratio has dropped to 33.8, signaling weakening network utility and diverging from valuation metrics [5]. However, the MVRV Z-Score at 1.43 aligns with historical bull market bottoms (2017, 2021), suggesting the 30% correction from $124K to $95K may be part of a healthy consolidation phase [3].

Value Days Destroyed (VDD) is in the “green zone,” indicating long-term holders are absorbing discounted Bitcoin [1]. Exchange flows also show strategic buying from the 1–2 year holding cohort, mirroring 2020–2021 accumulation patterns [1]. This aligns with institutional demand, as BlackRock’s $70B Bitcoin ETF and dovish Fed policy drive inflows [6].

Macro Fundamentals: ETFs and Scarcity as Tailwinds

Bitcoin’s structural bull case remains intact despite short-term volatility. ETF inflows into BlackRock’s IBIT and Fidelity’s FBTC surged by $63M and $65M on August 25, reflecting institutional confidence [1]. The 2024 halving, which reduced mining rewards to 3.125 BTC per block, has tightened supply issuance, reinforcing scarcity-driven demand [1].

However, macroeconomic risks persist. U.S. inflation at 2.7% and core inflation at 3.1% create uncertainty, while whale-driven dumping (e.g., a $438M flash crash in August) highlights liquidity risks [1]. Institutional buyers like MicroStrategy and Harvard’s $120M iShares Bitcoin Trust allocation suggest growing acceptance, but panic selling could still test $90K [3].

Tactical Entry and Exit Points

For traders, the $105K level offers a high-risk, high-reward entry if it holds, with a stop-loss below $100K. A bullish breakout above $113.5K could target $124.5K, leveraging the flag pattern [6]. Conversely, a breakdown below $100K may see Bitcoin test $95K–$90K, with a stop-loss above $105K for short sellers.

Long-term investors should monitor the NVT ratio and MVRV Z-Score. A drop in NVT below 1.51 and a MVRV Z-Score reentry into the 1.0–1.5 range could signal a buying opportunity [3]. Meanwhile, ETF inflows and 401(k) regulatory tailwinds provide a floor for institutional demand [4].

Conclusion

Bitcoin’s $105K level is a battleground between bearish momentum and institutional resilience. While technical indicators and NVT suggest caution, on-chain metrics and macro fundamentals hint at a potential Q4 2025 rally. Investors must balance short-term volatility with long-term structural trends, using key levels and on-chain signals to navigate this pivotal phase.

Source:
[1] Bitcoin's $105K Support: A Critical Inflection Point for BTC Bulls & Bears [https://www.ainvest.com/news/bitcoin-105k-support-critical-inflection-point-btc-bulls-bears-2508/]
[2] Bitcoin's MVRV Compression and Market Consolidation [https://www.ainvest.com/news/bitcoin-mvrv-compression-market-consolidation-strategic-entry-points-bullish-cycle-pause-2508/]
[3] Bitcoin Q1 2025: Historic Highs, Volatility, and Institutional Moves [https://blog.amberdata.io/bitcoin-q1-2025-historic-highs-volatility-and-institutional-moves]
[4] Q3 2025 Bitcoin Valuation Report [https://www.chaincatcher.com/en/article/2199982]