Bitcoin (BTC) is once again testing key psychological resistance near $104,000, but behind the price action lies a growing sense of unease among traders. While bulls continue to defend this critical level, warning signs are flashing in the order book and broader market structure. Analysts suggest that despite recent volatility, the real market-moving event may still be weeks away — quietly brewing beneath the surface.
Market Dips as Wall Street Opens: BTC Tests $104K Support
On June 17, Bitcoin slipped below the $105,000 mark shortly after U.S. markets opened, with intraday lows reaching $104,401 according to data from Cointelegraph Markets Pro and TradingView. The drop was accompanied by an unusual string of 11 consecutive red hourly candles — a rare technical pattern that has heightened concerns about weakening bullish momentum.
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Order book analysis reveals troubling signs of liquidity manipulation, a tactic often used by large traders to trigger stop-loss orders and amplify downward pressure. Material Indicators, a well-known trading analytics platform, highlighted on X (formerly Twitter) that shifting bid-side liquidity around the $105,000 zone suggests deliberate market influence.
“This is what manipulation looks like in the Bitcoin order book,” Material Indicators stated. “If price breaks below $105,000, prepare for a carpet-mine drop at $104,000.”
Such tactics — often referred to as liquidity hunting or spoofing — involve placing large fake buy or sell orders to mislead other traders about supply and demand. When smaller players react, the large holder cancels the order and profits from the resulting price movement.
Despite these pressures, Bitcoin bulls have so far managed to avoid a full-blown panic. There’s been no widespread capitulation in spot markets, and futures funding rates remain neutral-to-positive — suggesting traders aren’t rushing for the exits just yet.
Still, the path forward remains uncertain.
Key Resistance and the Road to $110K
Material Indicators noted that if BTC can reclaim and sustainably trade above $108,000, it could open the door to a fresh rally toward $110,000. Until then, the market remains in a fragile equilibrium — vulnerable to both breakout moves and sharp corrections.
Skew, a respected derivatives analyst, echoed this cautious optimism. In a recent post on X, he observed that trader behavior during this correction has been notably more disciplined compared to past downturns.
“For a ~3% drawdown, there’s surprisingly little panic,” Skew wrote. “Yes, we’re seeing some hedging on lower timeframes, but nothing like the aggressive shorting, spot selling, or volatility spikes we saw during previous 5% drops.”
This relative calm suggests institutional players are holding their positions — possibly anticipating larger macroeconomic catalysts down the line.
“The big move hasn’t happened yet,” Skew added. “It’s still brewing.”
Dollar Weakness Reversing? DXY Signals Potential Comeback
While much attention focuses on Bitcoin, another key player in the financial landscape is showing signs of life: the U.S. dollar.
The Dollar Index (DXY), which measures the greenback against a basket of major currencies, recently hit a three-year low — but analysts now see conditions ripe for a rebound.
Guilherme Tavares, a market strategist and trader, pointed to several technical indicators signaling a potential reversal:
- Extreme bearish positioning among asset managers
- DXY trading near long-term support levels
- 14-day RSI deeply oversold, showing bullish divergence
“The last time positioning was this overwhelmingly short on the dollar, we saw a sharp bounce,” Tavares explained. “Now, with RSI flashing divergence and price near key support, a recovery looks increasingly likely.”
A stronger dollar could pose headwinds for risk assets like Bitcoin, which historically trades inversely to DXY. If the greenback regains momentum — driven by rising Treasury yields or hawkish Fed sentiment — BTC may face additional downward pressure in the near term.
At the same time, gold (XAU/USD) has failed to surge despite ongoing Middle East tensions, suggesting markets aren’t pricing in extreme geopolitical risk.
The Kobeissi Letter, a financial commentary outlet active on X, dismissed fears of a global conflict escalating from Israel-Iran tensions:
“Gold is strong, yes — but it’s telling a consistent story: we are not on the brink of World War III. Oil rose only ~2% today. The 10-year yield is nearing 4.50%. Markets are signaling this won’t be a lasting disruption.”
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Frequently Asked Questions (FAQ)
What does "liquidity hunting" mean in Bitcoin trading?
Liquidity hunting refers to the practice where large traders or algorithms target areas with clustered stop-loss orders — often visible in the order book — to trigger rapid price movements. By pushing price into these zones, they can create artificial breakouts or breakdowns and profit from the resulting volatility.
Why is $104,000 such an important level for Bitcoin?
$104,000 acts as both psychological support and a technical magnet due to dense resting buy orders in that range. A break below could trigger cascading liquidations, especially if it coincides with weak market structure or negative macro news.
How does the U.S. dollar affect Bitcoin price?
Historically, Bitcoin has exhibited an inverse correlation with the U.S. Dollar Index (DXY). A stronger dollar makes dollar-denominated assets like BTC less attractive to global investors, often leading to outflows. Conversely, dollar weakness tends to boost demand for alternative stores of value like Bitcoin.
Are we due for a bigger Bitcoin move soon?
Many analysts believe so. Despite recent fluctuations, trading volume and volatility remain relatively subdued compared to previous bull market peaks. With key macro events on the horizon — including potential rate cuts and ETF inflows — many expect a more decisive directional move later in 2025.
Is Bitcoin showing signs of manipulation?
Short-term order book distortions are common in crypto markets and often reflect tactics like spoofing or iceberg orders. While not illegal per se, they can mislead retail traders. However, sustained price trends still depend on real demand and macro drivers.
Should I sell Bitcoin if it drops below $105K?
There’s no one-size-fits-all answer. Traders should assess their risk tolerance, entry points, and overall strategy. That said, a close below $104,000 with high volume could signal further downside — warranting caution or hedging rather than blind holding.
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Final Outlook: Calm Before the Storm?
For now, Bitcoin remains locked in a narrow but tense range between $104,000 and $108,000. Bulls are fighting to preserve gains while bears probe for weaknesses in liquidity structure. Meanwhile, macro forces — from dollar strength to geopolitical stability — suggest volatility may be suppressed temporarily rather than resolved.
As Skew noted: “The big move hasn’t happened yet.”
With institutional positioning stable and technical indicators flashing mixed signals, patience may be the best strategy. Whether the next major leg is up or down likely depends on external catalysts — not just internal order flow.
One thing is clear: when the next wave hits, it could come fast — and catch many off guard.
This article does not constitute financial advice. Cryptocurrency investments are highly volatile and risky. Always conduct your own research before making any trading decisions.