Bitcoin Stumbles Below $111,000: How Low Can It Go?

Bitcoin BTC/USD dropped over $4,000 in a matter of minutes on Sunday, a move that established fresh support and resistance levels to watch.

What Happened: In a post in his exclusive Patreon group, prominent analyst Kevin said Bitcoin has recently tested a major support zone at $110,700, which aligns with the 0.5 Fibonacci retracement level and the daily 100 exponential moving average.

This support is critical, as it cleared liquidity pools down to $111,000 and set up a significant CME gap to the upside at $117,200, a level that historically has an 80%+ probability of being filled.

While the Sunday dip triggered heavy liquidations, this move may be more bullish than bearish in the short term, suggesting potential for recovery.

Why It Matters: The crypto king's current price action is largely driven by declining Bitcoin dominance, although it has yet to translate into a full-scale altcoin rally beyond a few standout performers.

For a true altseason to emerge, BTC must rally alongside alts while its dominance continues to drop, similar to the brief market action seen after Jackson Hole, Kevin said.

The key confirmation signals would be Ethereum ETH/USD entering price discovery, BTC breaking its weekly bearish divergence, and Bitcoin pushing into the $120,000–$125,000 range.

For now, the focus remains on the resistance of Total 2 (Altcoins + ETH) at $1.73 trillion.

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A weekly close above this level, followed by sustained bullish candles, would confirm a breakout. Until then, resistance should be respected, and the strategy is to stay patient while waiting for stronger macro confirmation.

Also Read: Bitcoin Slips To $111,000, XRP Dips Under $3 As Ethereum, Dogecoin Defend Key Levels On Macro Jitters

What's Next: Kevin says Bitcoin's key objective now is to reclaim the 0.786 Fibonacci level at $118,300 and the 4-hour 200 SMA/EMA near $116,700.

Until these levels are reclaimed, BTC technically remains in a short-term downtrend.

However, the market is also showing bullish divergence signals, with lower lows in price but higher lows in indicators such as RSI and Market Cypher on the 4-hour chart, which could point toward an upcoming reversal.

In the broader crypto market, Total 2 is approaching a critical breakout point that could lead to price discovery and invalidate the weekly bearish RSI divergence that has been forming since early 2024.

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