Bitcoin (BTC) briefly rose to just under $112,000 on Monday before dropping back to about $107,700, suggesting that recent gains may be running out of steam.
The move followed a weekend rebound from below $104,000, but analysts now warn that weak derivatives activity and upcoming U.S. inflation data could bring more turbulence.
Short-Lived Uptick Reveals Market Fatigue
At first, the price rise from $106,000 to nearly $112,000 seemed positive, but an assessment by analyst CryptoMe, shared on social media on October 21, shows that key market metrics tell a different story.
According to the market technician, Open Interest, which reflects the total number of outstanding derivatives contracts, did not climb significantly during BTC’s price ascent. CryptoMe interpreted this as little appetite for opening new leveraged positions.
Furthermore, the funding rate stayed below the neutral level of 0.01, and CME futures saw low volume, meaning traders weren’t willing to pay extra to keep long positions.
“In short, there wasn’t the aggressive liquidity inflow or position-opening enthusiasm we were hoping for,” wrote the analyst.
This technical weakness comes at a sensitive time. On Friday, October 24, the latest U.S. Consumer Price Index (CPI) data will be released. All financial markets pay close attention to this inflation report, and in the past, it has caused big price swings in cryptocurrencies.
A higher-than-expected figure could put a lot of downward pressure on Bitcoin, with the current market structure showing that buyers are mostly concentrated between $97,500 and $104,000, while the $100,000 level serves as an important psychological support.
“There’s visible demand in this range. But don’t forget, psychological supports are not very strong supports,” CryptoMe cautioned.
Meanwhile, CoinGecko data shows that Bitcoin has dropped 2.5% in the last 24 hours and 4.6% in the past week. The flagship cryptocurrency is now worth 14.5% less than its all-time high recorded on October 6, when it exceeded $126,000. Market capitalization stands at roughly $2.15 trillion, with daily trading volume around $60 billion.
Analysts Split on Next Move
Given its recent performances, observers are divided over Bitcoin’s next direction. Dr. Profit recently told followers that “bulls will be proven wrong,” predicting a drop below $101,000 soon, while veteran trader Bob Loukas warned that “complacency here is dangerous” as Bitcoin enters a critical point in its four-year cycle.
On the other hand, CryptoAmsterdam suggested in a post today that BTC has “reclaimed the range low” and could still hold it as mid-term support, even though a deeper retrace is possible if that level breaks. On his part, Titan of Crypto noted that the monthly LMACD cross, still unconfirmed, could signal either a cycle top or the start of a bear phase.
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