Bitcoin Price Tests $117K Support As Liquidations Top $800M

Bitcoin faced renewed pressure over the weekend after large liquidations sent prices briefly under $117,000. The decline followed more than $800 Million in long position wipeouts.

It raised a debate among analysts about whether the move marked a healthy pause or the start of a deeper retracement. At press time, Bitcoin traded near $118,000.

Bitcoin Price Holds Critical Technical Levels

Technical analysts identified $120,000 as the nearest resistance, a zone reinforced by volume profiles and anchored by the volume-weighted average price (VWAP).

Immediate support appeared close to $118,200, with stronger demand centered near $116,300.

That area aligned with the 200-day exponential moving average, daily support, and Fibonacci retracement levels.

Momentum indicators delivered mixed messages. On the four-hour chart, the relative strength index (RSI) signaled hidden bullish divergence, hinting at rebound potential.

On the daily chart, however, bearish divergence suggested the possibility of continued selling pressure.

If sellers pushed below $116,000, downside targets ranged from $113,000 to $110,000. A recovery above $120,000 could open the path toward $126,000, with some analysts pointing to $130,000 as the next significant barrier.

Traders said the short-term battle would hinge on whether buyers defended the $116,000–$117,000 zone.

Treasury Stance and Inflation Data Shape Sentiment

Market mood was influenced by developments in Washington. Treasury Secretary Scott Bessent clarified earlier in the week that the US government would not purchase Bitcoin directly to expand reserves.

Instead, the Treasury would rely on confiscated assets. Analysts said this approach removed the prospect of steady reserve accumulation.

That makes Bitcoin price more vulnerable to macroeconomic shifts. Bessent said reliance on seizures made future supply growth less predictable.

The policy announcement coincided with stronger-than-expected Producer Price Index data, which reignited inflation concerns.

The figures pressured broader risk assets, including digital tokens, as investors adjusted expectations for interest rates.

Market strategists noted that the combination of Treasury policy and inflation data created a challenging backdrop for risk appetite.

Whale Activity and Long-term Outlook

While smaller traders showed caution, blockchain monitoring firms reported accumulation by large holders, commonly referred to as whales.

Data indicated that some whales increased their BTC holdings during the downturn, reflecting confidence in the asset’s resilience.

Many positioned ahead of the 2025 halving, an event that will cut mining rewards in half. Historically, halvings reduced token supply growth and often coincided with upward price cycles.

Analysts noted that institutional adoption and scaling efforts, such as the Bitcoin Lightning Network, could amplify the impact of the upcoming halving.

Some research groups argued that retests of $117,000–$118,000 would likely attract buyers. They identified deeper support at $113,000 and $110,000 if selling intensified.

Analysts at CoinCentral said the consolidation resembled a market reset rather than a structural breakdown.

They projected potential longer-term upside toward $250,000 by 2026 if adoption trends continued.

Despite the short-term volatility, several strategists said Bitcoin’s role as a potential inflation hedge remained intact.

Long-term holders appeared less concerned with near-term fluctuations, focusing instead on structural supply mechanics and institutional demand.

Outlook Ahead of Key Catalysts

The immediate outlook for the Bitcoin price depended on whether bulls could defend the $116,000–$117,000 area.

A rebound from this support could test $120,000 and potentially extend toward $126,000–$130,000. A failure to hold may invite further pressure toward $113,000 or below.

As traders weighed technical signals against macroeconomic headlines, sentiment remained cautious but not uniformly bearish.

With the 2025 halving approaching and institutional participation rising, analysts said the broader structure of the market stayed constructive, even as volatility persisted in the short term.