Bitcoin Faces 2-3% Drop Amid Bullish Continuation Pattern

Bitcoin (BTC) has been on an upward trajectory in the weekly and monthly timeframes, despite recent hourly chart fluctuations. The cryptocurrency has formed a bullish continuation pattern after being rejected at its all-time high of around $111,900, set in May 2025. Since June 9, 2025, BTC has faced significant resistance at approximately $110,500, leading to a 2-3 percent drop. The recent dip below $108,000 has sparked concerns about further short-term corrections.

Several major factors are expected to drive a resurgence in bullish sentiment for Bitcoin. From a technical standpoint, BTC has traded above a crucial weekly support level of around $104,354 over the past five weeks. In the past three weeks, the price has been retesting the bullish breakout, indicating a potential parabolic rally. In the 1-hour timeframe, BTC has been retesting a bullish breakout from a falling logarithmic trend, suggesting a major rebound is imminent.

The weakening U.S. dollar, despite historical efforts to strengthen it, is another key factor. The DXY, which measures the U.S. dollar's value against other major currencies, has been declining. This trend, coupled with the strengthening of currencies like the Chinese Yuan, could boost Bitcoin's underlying value. U.S. regulators are also taking strategic steps to maintain the dollar's global dominance, including the use of stablecoins through clear regulations. This move is expected to significantly increase crypto liquidity and the global money supply (M2).

Institutional demand for Bitcoin is surging. According to aggregate data from BitcoinTreasuries, the number of entities holding Bitcoin in their treasuries has increased by 21 firms in the past 30 days, raising BTC holdings by 3.28 percent to 3.41 million. Institutional investors, including GameStop, are leveraging global equity markets to strengthen their Bitcoin holdings. U.S. spot Bitcoin ETFs, led by BlackRock’s IBIT, have been accumulating more BTCs, resulting in a significant decline in the balance of Bitcoin on centralized exchanges to a multi-year low of about 2.09 million coins. This confirms a major supply vs. demand shock.

Analysts predict that Bitcoin's price could rebound and reach new all-time highs before the end of June. Technical indicators suggest that Bitcoin is poised for a breakout above key resistance levels, driven by improving market sentiment. The weakening U.S. dollar and regulatory clarity in the crypto space are also contributing to the bullish outlook. As more institutional investors enter the market, demand for Bitcoin is likely to increase, pushing its price higher. The improving macroeconomic environment, with softening headwinds and rapidly improving sentiment, could provide additional support for Bitcoin's price.

In summary, a combination of technical strength, a weakening U.S. dollar, regulatory clarity, and improving macroeconomic conditions are driving the bullish sentiment for Bitcoin. These factors, combined with rising institutional demand, could push Bitcoin's price to new all-time highs before the end of June.