Bitcoin Trades 2.2% Below All-Time High Amid Correction Fears

Bitcoin, the world's largest cryptocurrency by market capitalization, is currently trading at $109,519, just 2.2% below its all-time high of $111,970. However, analysts warn that there is little fundamental support for the asset to meaningfully break above this level. According to Bitfinex analysts, the risk of a short-term correction continues to build, especially in the absence of a strong catalyst to push Bitcoin decisively above its current all-time high.

Long-term holders of Bitcoin are now faced with a crucial decision: whether to sell off their assets or hold onto them. Those who bought Bitcoin during the first quarter of 2025, when it hit a low of $78,513, are now up by 39%. However, the analysts caution that a sudden sell-off by these long-term holders could lead to a prolonged consolidation phase for the cryptocurrency market.

Bitcoin is not unfamiliar with consolidation phases after reaching new all-time highs. In March 2024, Bitcoin reached an all-time high of $73,679 before entering a consolidation phase, swinging within a range of around $20,000 until the US presidential election in November. The current situation is similar, with Bitcoin trading sideways near its all-time high levels.

Analysts are currently eyeing several macro events that could potentially impact Bitcoin's price. The US Federal Reserve's upcoming interest rate decision on June 18 is a key event that many market participants are watching for macroeconomic signals. Interest rate cuts are considered a bullish indicator for risk-on assets like Bitcoin and other cryptocurrencies. Additionally, developments related to US President Donald Trump's tariff policies are also being closely monitored, as the ongoing loop of tariff uncertainty poses a significant risk for those betting big on Bitcoin over the next two months.

In conclusion, while Bitcoin has shown resilience in maintaining its price above $105,000, the lack of a strong catalyst to drive the price beyond $112,000 has left the market vulnerable to short-term corrections. Investors should remain vigilant and monitor the market for any signs of a change in trend. The decision of long-term holders to sell off or hold onto their assets will help define the next leg of the market structure.