Bitcoin Drops Below $107,000 Amid Bearish Signals

Bitcoin's price recently experienced significant volatility, briefly surpassing $107,000 before retreating. This price action reflects a broader trend of consolidation and uncertainty in the market. Despite exchange reserves hitting a six-year low, Bitcoin's price has struggled to maintain momentum above key resistance levels. The cryptocurrency's inability to sustain above $107,000 indicates growing resistance and bearish signals, with traders closely watching the $105,500 support level to gauge the future direction of the market.

The recent price action has seen Bitcoin drop below $107,000, extending its mild decline from the previous day. This pullback has been attributed to a loss of momentum for bulls, particularly around the $107,500 zone, which has consistently capped upward movements. The failure to break below the 0.618 Fibonacci support at $105,889 further supports a declining outlook, with bearish indications emerging on the daily chart. The Supertrend has reversed to a sell signal, and the Parabolic SAR has produced a dot above the price, signaling downward pressure. Additionally, the Ichimoku cloud with a 30-minute interval indicates that Bitcoin is within the cloud and trading below the Tenkan and Kijun lines, suggesting short-term indecision.

Despite the decline, Bitcoin's broader trend remains functional. On the 4-hour chart, the lows are rising above the bottom on June 24 at $101,900, and the internal trendline is maintained. However, the recurring rejection of levels around $108,000 creates a fear of a stronger pullback if support around $105,500 is broken. The converging Bollinger Bands on the 4-hour chart indicate a potential break in the future. A closure above $108,500 daily could revive the bull trend towards $110,500 and $118,000. Conversely, if Bitcoin loses the $105,500 support, it could potentially drop to lower levels near or below $103,200 and even $101,250 in the short term.

The recent price action has also seen a decline in the number of investors cashing out, as Bitcoin's price recovers to $107,000. This resilience among investors is reflected in the fact that a super-majority of Bitcoin investors are now holding unrealized profits. This suggests that despite the price fluctuations, there is still significant confidence in the long-term potential of Bitcoin. The market's bullish momentum appears to be waning, as indicated by the failure to break below the 0.618 Fibonacci support at $105,889. However, the broader trend remains functional, with the lows rising above the bottom on June 24 at $101,900, and the internal trendline is maintained. The converging Bollinger Bands on the 4-hour chart indicate a potential break in the future, with a closure above $108,500 daily could revive the bull trend towards $110,500 and $118,000. Conversely, if Bitcoin loses the $105,500 support, it could potentially drop to lower levels near or below $103,200 and even $101,250 in the short term.