Bitcoin fell beneath a closely watched support band, with a high probability that the next stop is USD 105.000. Thin order books and positions built on heavy leverage are feeding the decline, impacting leveraged traders, risk control desks and ETF holders alike.
The speed of the decline to sparse liquidity, excessive speculative leverage, weak ETF inflows and a firmer dollar. These forces have accelerated selling and amplified price swings as bids thin out and volatility rises.
The 20-day EMA at 105.347 failed to hold, and the crossover beneath that line points directly toward a test of 105.000. For any bounce to last, buyers must lift and keep the price above 106.800; clearance of that zone would open the way to supply areas located at 109.588 and 111.980.
Technical definition – a put option gives the holder the right to sell an asset at a fixed price and serves as insurance against further declines.
Bitcoin Faces Correction
Leverage risk is amplifying forced sales and volatility as excess debt in positions accelerates liquidations. Demand for protection is rising, with increased put buying showing traders hedging. Liquidity remains thin, with fewer resting orders widening spreads and steepening moves. ETF flow has softened, as low issuance of new shares removes a standing source of bids.
Regulation and compliance remain a headwind as custody security and shifting rules still weigh on liquidity and trust; custodians and institutions must fold those factors into risk limits.
The path forward hinges on the 105 000 and 106 800 thresholds; how price reacts around these areas—amid thin liquidity, leverage and ETF flow dynamics, plus regulatory and custody considerations—will set the tone for the next move.
