Bitcoin News Today: Bitcoin's consolidation puzzle: Correction or setup for $120K?

Bitcoin held steady near $118,348 on Sunday, with analysts identifying key technical levels and diverging scenarios for the near-term price action. The cryptocurrency briefly peaked near $118,600 during the previous two days before retreating slightly. Analysts such as Lark Davis and Michaël van de Poppe provided contrasting yet complementary views on how BTC might proceed. Davis suggested a potential pullback to the $108,000–$112,000 range, a zone that historically served as support after acting as resistance earlier this year. He cited Fibonacci retracement levels and the 20-week exponential moving average as reinforcing the likelihood of a correction before a new upward leg. Van de Poppe, meanwhile, emphasized that BTC had been rejected at its recent highs, signaling a possible period of consolidation rather than a sharp decline. He noted repeated failed attempts to break above resistance levels, with candlestick patterns indicating strong selling pressure near the top of the current range.

The broader market environment shows a shift in sentiment, as highlighted by the CryptoQuant Bull Score Index, which recently moved into a "neutral" phase from a "Bullish Cooldown." This shift suggests that while a full bearish reversal has not occurred, bullish momentum has weakened. Julio Moreno, head of research at CryptoQuant, warned that further deterioration in the index could increase the likelihood of deeper corrections. On-chain data also reflected reduced buying pressure, particularly on Binance, where net outflows reached nearly $600 million. This decline was attributed to profit-taking at key resistance levels and a lack of sustained buyer activity, signaling a temporary shift in market dynamics.

Technical indicators continue to highlight the $115,000–$118,000 range as a critical zone for consolidation. Recent price action saw BTC rebound from support near $117,261 after a sharp rally on August 17. The asset briefly surged from $118,165 to $118,604 on a single hour of high-volume trading, reinforcing the $118,600 level as a potential short-term resistance point. However, the price soon consolidated near $118,400, indicating a mixed signal for traders. According to CoinDesk Research's technical analysis, the 24-hour period from August 16 to 17 showed a 1% gain, with the price moving from $117,847 to $118,485. This range remains under close observation, as any sustained break above or below could trigger a new trend.

Analysts also pointed to structural shifts in miner behavior as a potential indicator of future price movements. Unusual activity was observed in transfers from Binance to miner-linked wallets, a reversal of the typical flow seen during bullish phases. These transfers could indicate either accumulation or strategic redistribution of Bitcoin, depending on whether the mined coins are being stored off-exchange or moved for future liquidation. If miners are indeed accumulating BTC, it could reduce short-term selling pressure and support the market by limiting available supply. However, the ultimate impact of this trend will depend on how miners choose to manage their holdings in the coming weeks.

The possibility of a rotation into altcoins was another recurring theme among analysts. Van de Poppe suggested that a period of consolidation in BTC could create favorable conditions for altcoin activity, as traders often seek higher returns in large-cap alternatives like Ether when Bitcoin stabilizes. Historical patterns indicate that altcoin rallies typically follow periods of BTC consolidation rather than during sharp price declines. This dynamic could support broader market participation, especially if Bitcoin remains in a trading range between $112,000 and $118,000 for an extended period. Traders are advised to monitor on-chain metrics and key support/resistance levels for confirmation of these potential scenarios.

Price volatility remains a central concern, with Bitcoin currently trading around $116,750 after a 3.42% 24-hour gain. The short-term outlook suggests a likely consolidation phase between $115,000 and $118,000, with traders waiting for a weekly candle close to confirm the direction. A strong weekly close above $111,919 could signal renewed bullish momentum and increase the chances of BTC testing $120,000. Conversely, a weak close may prolong the current range and open the door for deeper corrections toward the $108,000 level. As the market navigates these uncertainties, analysts agree that structural demand and macroeconomic factors—including Federal Reserve policies and institutional inflows—will play a decisive role in shaping Bitcoin’s trajectory in the coming weeks.

Source:

[1] Bitcoin Steadies at $118K as Analysts Flag Deeper Pullback Risks and Altcoin Rotation (https://www.coindesk.com/markets/2025/08/17/bitcoin-steadies-at-usd118k-as-analysts-flag-deeper-pullback-risks-and-altcoin-rotation)

[2] Bitcoin Steadies at $118K as Analysts Flag Deeper Pullback (https://finance.yahoo.com/news/bitcoin-steadies-118k-analysts-flag-164010713.html)

[3] Bitcoin Bull Score Index Signals Fading Momentum (https://www.mitrade.com/insights/news/live-news/article-3-1062729-20250823)

[4] Bitcoin Slides Below $120K as Buyers Retreat, Is the Rally Over? (https://www.mitrade.com/insights/news/live-news/article-3-1063457-20250823)

[5] Santiment: Bitcoin's 2025 Volume Peaks Have Been the Key Buy-Sell Signals (https://cryptopotato.com/santiment-bitcoins-2025-volume-peaks-have-been-the-key-buy-sell-signals/)

[6] Bitcoin Market Structure 'Still Looks Extremely Bullish' Says FalconX Head of Research (https://www.coindesk.com/markets/2025/08/20/btc-market-structure-still-looks-extremely-bullish-says-falconx-head-of-research)

[7] Bitcoin May Consolidate Near $115000–$118000 After Breakout (https://www.bitget.com/news/detail/12560604925921)

[8] Bitcoin Faces Bearish Pressure as Analyst Warns of Potential Drop Toward $108K (https://www.financemagnates.com/trending/bitcoin-faces-bearish-pressure-as-analyst-warns-of-potential-drop-toward-108k/)