Gigantic Bitcoin (BTC) Resistance Born: Price Level

In recent months, Bitcoin has encountered one of its most crucial resistance zones as price action has repeatedly been rejected around the $120,000 mark. Price charts and the BTC/USDT Liquidation Heatmap both show that this zone is not psychological, and with leveraged positions popping up, the current price range becomes a battleground for both bulls and bears.

An intense cluster of liquidation leverage around $120,000 is visible on the liquidation heatmap. This implies that short positions are heavily concentrated just above the current price action. Because these shorts are probably set with tight stops, a breakout could lead to a short squeeze, which would quickly push prices even higher. But in the meantime, this cluster is acting as resistance, encouraging market makers to seek liquidity ahead of any significant breakouts.

Bitcoin is consolidating just below resistance, trading at about $118,000, after exhibiting relatively steady price action over the previous few days. Classic volatility squeeze behavior is still there and in the volume profile, which displays decreasing activity. The RSI is just below overbought, suggesting that if a trigger is struck, the market may surge, but it also warns of exhaustion if bulls are unable to make a breakthrough soon.

At $116,000, there is a significant liquidation zone on the downside. The price is likely to be the target of a liquidity grab if it is rejected once more at $120,000 and drops. With the 50, 100 and 200-day lines pointing upward and widely separated, a structurally sound configuration, Bitcoin is still trading above all of the major moving averages, which continue to stack bullishly.

The bottom line: this $120,000 threshold is the main threshold for the digital gold. If we break it with volume, the price will quickly approach $125,000+. If this does not work well, it will go back and reload at $116,000, with the potential of plunging even lower, considering the waning liquidity at lower price levels.