Earlier we reported that the price of Bitcoin had surpassed the $120,000 mark for the first time. In that analysis, we:
→ constructed an ascending channel (highlighted in blue);
→ noted that the market was in a vulnerable position for a potential pullback;
→ identified a purple rectangle as a zone of imbalance (or Fair Value Gap – from the perspective of the Smart Money Concept methodology), where buyers had proven their dominance.
Since then, the purple zone has acted as a support area (as indicated by the arrows), but ultimately failed to prevent Bitcoin from falling towards the $115,000 level.
This decline occurred despite a significant influx of institutional investment into the leading cryptocurrency, likely driven by the recent all-time high. According to The Block, corporate buyers and investors acquired approximately 166,000 Bitcoins in July, with a total value exceeding $400 billion USD.
Among the notable buyers:
→ Michael Saylor’s company, MicroStrategy, reported three purchases totalling 31,466 BTC;
→ Trump Media & Technology Group disclosed a purchase of 18,430 BTC.
Technical Analysis of the BTC/USD Chart
Following the aforementioned all-time high, the price has exhibited a predominantly downward trend, visualised by the trajectory of the two red lines.
Given that Bitcoin's price is currently near the median line of the long-term ascending channel, we could expect a potential consolidation phase. This zone typically represents a balance point between supply and demand within the channel.
Key levels that could play a significant role in the cryptocurrency's price action include:
→ Support at the psychological level of $110,000 – the origin of a strong bullish impulse on 9 July;
→ Resistance at $116,000 – previously served as support (upper boundary of the FVG zone), but has since been breached and is now acting as resistance.
