Bitcoin remains a key player in the cryptocurrency market, even while experiencing a phase of correction typical of bull cycles. In recent days, the price has dropped by more than 5%, moving from record levels to a valuation of 116,800 dollars. This dynamic does not represent a structural weakness, but rather a physiological movement driven by profit-taking after the sustained rises that have characterized recent months.
Market retracement and consolidation for Bitcoin
The recent retreat of Bitcoin is interpreted by analysts as a classic phase of pullback from bull market. The price has moved away from the all-time highs, testing the threshold of 111,960 dollars, already identified last May 22 as a key breakout point upwards. This occurrence shows how the market tends to retrace its own technical breakdowns before triggering new, more sustained rallies.
During 2024, similar situations have already occurred: just think of the drop from 100,000 to 75,000 dollars, followed by a vigorous recovery. Currently, the technical picture remains positively set as long as the price stays within the ascending channel on the daily chart.
Technical indicators: momentum and signals of possible recovery
The analysis of the hourly chart of Bitcoin reveals a pronounced decline, with prices below the Ichimoku cloud — indicating a short-term bear momentum. However, there is also an observation of an RSI (Relative Strength Index) that has plummeted below the 30 mark, identifying a condition of intense oversold, in stark contrast to the bull excess recorded just the previous day.
This configuration leaves room for hypotheses of a sudden rebound, especially in the event of a break of the descending trendline. If this potential reversal were to materialize, Bitcoin prices would have an open field towards new all-time highs.
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One of the key elements that demonstrate the vibrancy of the Bitcoin market lies in the open interest, which is the total amount of futures contracts still open. With a cumulative value of 734,820 BTC, the market is approaching the record of October 2022, set at 744,000 BTC. This growth is particularly driven by offshore exchanges, while on the CME, activity remains below the peaks of May and the annualized basis is under 10%.
On the contrary, the annualized funding rates on offshore perpetual futures platforms have exceeded 11%, highlighting a renewed demand for “long” positions and a bull tendency among operators.
MOVE Index: signals of potential increase in volatility
Another indicator to monitor is the MOVE Index, which measures the 30-day implied volatility of U.S. Treasuries. In recent days, the index has started to rise again from a critical level that, in 2024, preceded volatility spikes even in cryptocurrencies.
Historically, an acceleration of the MOVE Index coincides with a tightening of financial conditions and often anticipates the local highs of Bitcoin. Therefore, the risk of a further correction in the current bull market remains valid.
XRP: key technical supports and record activity on futures
XRP follows a trend similar to that of Bitcoin, dropping from the 3-dollar mark and developing a clear hourly bear channel. However, the situation appears less critical thanks to the hold of the conjunction between the 100-hour simple moving average and the support offered by the Ichimoku cloud in the 2.81-dollar area.
From this level, an upward breakout could signal the end of the corrective phase, once again propelling XRP towards the annual high of 3.4 dollars. The bull operators will, however, have to face an intermediate resistance around the 3 dollar area.
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The current market excitement is confirmed by the perpetual futures on XRP, with open interest over 2.74 billion XRP, the highest level ever recorded. The annualized funding rate is around 15%, indicating a strong interest in leveraged bull positions.
ETH: compression and waiting for the breakout
Ether (ETH) appears stuck in an expanding triangle dynamic, with the daily stochastic in the overbought zone, indicating an already extended bull momentum. Consequently, the probability of a significant breakout in the short term appears limited.
The price, above the Ichimoku cloud on the daily chart, still maintains the bullish setup, also supported by short-term moving averages. A potential breakout would bring attention back to the 3,400 dollars level, a target also favored by options traders.
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Despite a double breakout to the upside on the daily chart, SOL struggles to overcome the new resistance at 168 dollars. Since Friday, the bulls have already failed two attempts to surpass this threshold, as evidenced by the long upper shadows of Monday’s and Friday’s candles.
To the downside, the level of 157 dollars acts as support, identifying the “neckline” of a double top pattern on the hourly chart. A break of this line would pave the way for a possible decline towards 146 dollars, according to the measurement method of technical patterns.
Monitor the key levels for SOL
Traders should pay attention to a breakout above $168 to confirm the continuation of the bull trend. In the absence of this development, losing support at $157 would pose risks of a deeper correction towards $146.
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The current landscape of the main cryptocurrencies — Bitcoin, XRP, ETH, and SOL — reflects a phase of high volatility and clear focus on technical levels. With open interest near historical highs and elevated funding rates, the markets remain fertile ground for both opportunities and amplified risks.
The entry into oversold or overbought areas, the evolution of the MOVE Index, and the price reactivity to the main supports and resistances will be determining factors for future movements. Investors must continue to monitor technical developments and volatility to identify the best operational strategies in an ever-changing scenario.
