Bitcoin (BTC) slipped 2% today, 2% as the broader crypto market continues to face downward pressure. This decline shows weakening trading volumes and showing cautious sentiment among investors.
However, on-chain data suggests that this pullback may be temporary.
BTC Bulls keep the line
One of the more notable signals comes from the intensive liquidity cluster that forms a $103,000 zone into a $103,000 zone. Measurements from the BTC liquidation heat map show a concentration of sub-price liquidity in the $103,221 zone.
BTC liquidation heat map. Source: Coinglass
This suggests that if prices are dumped towards this level, critical market support is waiting to be activated. A clearing heatmap is used to identify price levels where large clusters of leveraged locations are likely to be cleared. These maps highlight areas of high fluidity and are often color coded to indicate intensity.
BTC’s liquidation heat map suggests that if the coin witnesses a fix towards the cluster zone, strong support is waiting for it to absorb sales pressure. Traders have posted many buy orders in the $103,221 area, showing confidence that BTC is unlikely to fall below this threshold.
Additionally, a positive funding rate of 0.0025% at press adds to a careful optimistic outlook. It reflects the willingness of traders to pay premiums for longer positions.
BTC funding rate. Source: Coinglass
Funding rates are repetitive payments exchanged between long and short traders in permanent futures markets to maintain prices along the spot market. It shows bull market sentiment as more traders expect the value to rise when it comes to positive.
$106,000 or bust? Bitcoin’s next move is dependent on global tensions
Despite the bullish on-chain signal, BTC continues to be heavily affected by wider market sentiment, which is weakening amid escalating tensions between Israel and Iran.
If the geopolitical situation gets worse and potentially slides to $103,061, then the Bitcoin price rally could stall. If a liquidity cluster near $103,000 fails to provide support, a deeper drop to $101,610 could continue.
BTC price analysis. Source: TradingView
Conversely, once bullish momentum returns and market sentiment improves, the coin could rebound from its recent lows and move towards the $106,548 level.
