$BTC Increased tensions in the Middle East and a concerning fractal in the Bitcoin chart may contribute to BTC's price falling back below $100,000.
reached a weekly high of $110,653 on Monday, but currently accumulates a decline of 3.5%, retreating to the low of $106,600 this Thursday. The escalation of tensions between Iran and Israel, with reports that Israel is preparing a military action, has triggered a risk-averse sentiment, reflected in the movement of BTC.
From a technical standpoint, the current correction of BTC seems routine. BTC prices rose about 10% between June 6 and Tuesday, and a drop of 3.5% can be considered normal. Bitcoin researcher Axel Adler Jr shared a similar reading, explaining that the current market faces a 'soft reversal point.'
Based on the Bitcoin futures position dominance chart, the analyst explained that the decline may be caused by profit-taking on long positions in the resistance area, supported by aggressive short volume. Adler Jr stated:
"This is a classic 'soft reversal point' in a bullish trend: while funding remains positive, but open interest is falling, a short-term correction or consolidation below $108,000 should be expected."
Although a consolidation around $108,000 should not compromise the bullish trend, a fractal analysis points to the possibility of a deeper correction.
Is Bitcoin falling into a bull trap?
The recent rise of Bitcoin from $100,500 to $110,000 represents a setup similar to January 2025, when prices rose from $91,700 to $102,700. The current analysis reveals a convincing fractal pattern with possible bearish implications. A fractal is a repetitive trend that can lead to similar price movements in identical market conditions. As illustrated in the chart, the pattern can be summarized in three similar signals:
BTC's price broke a downward trend line after absorbing 3 to 4 weeks of residual liquidity, forming a bullish structure on the daily chart.
BTC failed to surpass the previous high, which, in both cases, was the all-time high.
The relative strength index (RSI) fell below 50 before recovering and facing rejection upon reaching 60.
If this fractal holds, Bitcoin may experience a sharp rejection, potentially dropping to $100,000, where there is significant support, as indicated by the liquidity zone on the chart. For this fractal analysis to be validated, the price would need to continue falling below Monday's lows, around $105,000.
This scenario raises concerns about a potential bull trap for BTC, in which the crypto asset could be signaling the start of a prolonged drop lasting several weeks. The invalidation of this thesis would occur if Bitcoin recovered and sustained above $108,000, negating the failure to break the high and suggesting the continuation of the bullish movement.