Bitcoin is hovering just below a key support level at $104,636, raising the likelihood of a liquidity sweep before a potential reversal.
Mixed liquidation data shows indecision, with long positions recently taking heavier losses, pointing to a cautious but slightly bullish sentiment.
Low volume and neutral RSI suggest consolidation, indicating that traders are waiting for a clear breakout above resistance at $105,910.
Bitcoin’s recent price action has presented a cautious landscape for traders and investors. The leading cryptocurrency has slipped by 0.7% over the past 24 hours, settling at $104,622 at the time of writing. This mild decline has placed it just below a critical support zone at $104,636, sparking discussions about potential liquidity grabs and market reversals in the short term.
Market Eyes Sub-Low Liquidity Sweep
According to analyst CryptoMichNL, the possibility that Bitcoin may dip further to absorb liquidity below recent lows before staging a reversal. This scenario has often played out in similar structures, where a temporary downward move is used to trigger stop-loss orders and gather buy-side interest, setting the stage for a recovery. The sentiment among some traders reflects this possibility, with a move under support seen as a trap for over-leveraged positions.
https://twitter.com/CryptoMichNL/status/1930508420672528517
The idea is supported by the current chart structure. As shown in the most recent market map, a break above the $105,910 resistance is likely to invalidate the bearish scenario, opening doors for a bullish continuation. For now, though, sellers appear in control, with price rejecting attempts to climb above nearby resistance.
Liquidations Reflect Mixed Sentiment
Data from Coinglass shows a complex liquidation landscape. Over the past few weeks, long and short positions have been wiped out in rapid succession, reflecting market uncertainty. The largest cluster of liquidations occurred in late February, when both long and short liquidations surged, corresponding with a significant price drop.
Source: Coinglass
Since then, liquidations have continued in smaller but consistent waves, with long positions bearing the brunt of the most recent selloffs. Despite a recent decline, traders are still more strongly bullish than bearish. Some traders are waiting for a bounce, though the market is still not turning clearly higher.
Volume and Momentum Offer No Clear Direction
Volume analysis indicates a slowdown in conviction. After an active May with significant volume surges, recent sessions have shown quieter price action. This can be a phase of accumulation, or simply indecision as market players wait for a breakdown or breakout out of the current range.
In addition, RSI on the 4-hour chart reflects a neutral waters market neither overbought nor oversold. This is in agreement with a consolidative phase rather than a clear trend, which adds to the ambiguity of the current setup.
Bitcoin remains within a narrow price band, and while key support zones are being tested, traders remain on alert for a more definitive move. A sweep of liquidity beneath the current low could precede a reversal if historical patterns hold true. However, failure to reclaim resistance at $105,910 could expose the asset to deeper declines.
