- Bitcoin struggles below $116,354-could a major crash be near?
- Market reset signals Bitcoin may drop further-$94,334 in sight.
- Bitcoin price stagnates, but a storm could be brewing soon.
Bitcoin has been struggling with a prolonged period of muted trading, currently fluctuating between $108,645 and $110,369. Following a sharp drop to a low of $108,623 on Thursday, Bitcoin managed to show a slight recovery on Friday. This uptick was sparked by the release of PCE data and a significant options expiry event.
However, Bitcoin’s price failed to hold onto these gains, erasing them early on Saturday. At the time of writing, Bitcoin is up just 0.3% in the past 24 hours, sitting at $109,330. Over the past week, the cryptocurrency has witnessed a 5.78% loss, signaling the potential for further declines.
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Crypto analyst Ali has pinpointed a critical price level for Bitcoin at $116,354, a threshold that must be reclaimed to avoid a further downturn. According to Ali, if Bitcoin fails to recover this key support level, the price could plummet to as low as $94,334, based on MVRV pricing bands. This indicates that a breakdown below $116,354 could be the catalyst for a significant crash, leading Bitcoin to drop into the five-figure range.
Is Bitcoin Heading for a Major Drop?
The market sentiment has shifted significantly following the largest options expiry on Deribit, as reported by Glassnode. The expiry event has reset market positioning, with Bitcoin stabilizing at $109,000—slightly below the $110,000 level, where options traders were hit with maximum pain. The reset of options positions leaves the market with a “clean slate,” prompting traders to reassess their strategies for the next move.
Additionally, Bitcoin’s open interest (OI) saw a sharp decline from 515,000 BTC to 355,000 BTC as positions rolled off during the expiry. This reduction in OI may indicate a lack of immediate market conviction. However, a future rise in OI could provide clues as to whether traders are gearing up for new exposure, potentially signaling a shift in sentiment.
While short-term caution remains in the market, long-term indicators still suggest an optimistic outlook for Bitcoin. That said, the current pause could be the calm before a storm, as analysts are carefully watching for signs of volatility. If Bitcoin’s price continues to fall below the critical $116,354 threshold, the cryptocurrency may face a more significant crash than previously anticipated.
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