For most of the past week, the price of Bitcoin (BTC) has been constrained below the $104,000–$105,000 range, which many analysts view as an important technical barrier. However, from another perspective, this trend may simply be an accumulation phase in a bull flag pattern – a typical continuation pattern following a strong rally.

A bull flag pattern typically forms when the price temporarily moves sideways or slightly corrects while the market "rests" after a breakout. When the price breaks above the resistance line of the pattern, the upward trend is often extended with stronger momentum.

Daily BTC/USDT chart | Source: TRDR.io

In the current scenario, the sideways price range is not necessarily a sign of a struggle between bulls and bears, but mainly reflects a weakening of demand. Data from TRDR.io indicates that the increase from $74,400 to $105,900 was accompanied by significant liquidations in the margin market, while spot trading volume surged, coinciding with several days of billion-dollar inflows into Bitcoin spot ETF funds.

Hourly BTC/USDT chart | Source: TRDR.io

Notably, during that three-week upward phase, many businesses in the US and internationally announced plans to buy Bitcoin as part of their asset reserve strategy. Indicators such as accumulated volume in the spot and futures markets, along with open contracts, suggest that most traders have realized profits near the peak, while the number of new long positions – both leveraged and spot trades – at the resistance level remains relatively modest.

Spot and margin BTC/USD trading CVD | Source: TRDR.io

Conversely, each time the price adjusts to the bottom of the bull flag pattern – acting as technical support – immediate demand reappears. However, the level of leverage used for new long positions remains low, indicating that market sentiment is not yet fully ready for the next breakout.

Bitcoin's recent correction is seen as a normal occurrence, following a nearly 40% increase since April 8. Profit-taking pressure at short-term peaks in the derivatives market has caused the upward momentum to stall – which is not too surprising given the rapid heating of the market.

Data from Glassnode regarding the profit/loss of the supply held by short-term investors reinforces this observation. The chart below records that although profit-taking activity from this group has increased, it still falls within normal statistical thresholds – leaving room for the upward trend to continue expanding in the near future.

"Notably, the short-term investor realized profit index (STH Realized Profit) has recently surged, approaching the +3 standard deviation threshold compared to the 90-day average – reflecting a significant level of profit realization. However, in previous cycles – especially during periods when the market approaches historical peaks – this index has exceeded +5 standard deviations. This indicates that the current profit-taking pressure is still not strong enough to overcome buying power, and the upward price trend still has room for development."

Short-term investor realized profit index | Source: Glassnode

Bitcoin may test support before continuing its upward trend

After most of the selling pressure was absorbed during the surge to the $105,000 mark, some analysts warned that Bitcoin may soon enter a short-term correction, returning to test support levels around $100,000-$90,000.

According to data from Material Indicators – which specializes in tracking cash flow and order behavior in the Bitcoin market – if no "truly negative catalyst" appears, it is highly likely that BTC will return to test support around $100,000. The FireCharts currently also reflect this scenario, as sell orders pile up at higher price levels, while buy orders are gradually allocated down to lower price levels, indicating clear preparation for a technical correction.

Bitcoin liquidity heatmap | Source: Material Indicators

On the social media platform X, analyst Daan Crypto Trades shared that the main factors driving the current strong upward and downward trends of Bitcoin have been "largely clarified." He pointed out that BTC's price is fluctuating around its historical peak, amidst continuing improvements in the stock market following President Trump's confirmation of the US-China trade agreement.

Regarding his personal strategy, Daan stated that the $90,000 level remains an important threshold for his long-term spot positions. He expressed a "cautious yet optimistic" view, as long as the price stays above this level – although he also emphasized that the short-term movements of the US stock market will be a key factor to watch.

"I wouldn't be surprised if a short-term correction occurs," he said, "especially if the stock market shows signs of reversing and establishes a higher low. With many stocks having surged 30% to 50% in just a month, a correction at this time is entirely possible."



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