Bitcoin has recently pulled back from its record high of $111,971, with the BTC/USD pair dropping below the 107,000 mark. This correction follows a surge driven by strong institutional demand and favorable macroeconomic expectations. While short-term volatility has returned, the long-term fundamentals of Bitcoin remain robust, supported by declining exchange supply, rising ETF inflows, and increasing macroeconomic tailwinds.
This article provides a comprehensive look at the current BTC/USD outlook, covering both bullish and bearish scenarios, technical analysis, and key catalysts that could influence price action in the coming days.
Bullish Outlook for BTC/USD
Despite the recent pullback, the bullish case for Bitcoin remains intact. Traders who believe in a continuation of the upward trend may consider the following strategy:
- Buy the BTC/USD pair with a take-profit target at $111,000
- Set a stop-loss at $104,000 to manage downside risk
- Expected timeline: 1–2 days
This setup capitalizes on the expectation that Bitcoin will retest its recent all-time high as market sentiment stabilizes. The correction is viewed by many analysts as a healthy consolidation after a rapid 50% rally from April’s lows.
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Bearish Scenario: Caution Amid Volatility
On the flip side, increased profit-taking and macro-level uncertainties have fueled bearish sentiment in the short term. A contrarian approach would involve:
- Sell BTC/USD with a take-profit at $104,000
- Place a stop-loss at $111,000 to protect against a rebound
The sell-off was triggered in part by geopolitical and economic concerns, including former President Donald Trump’s announcement of a proposed 50% tariff on European goods starting June 1. Such policies tend to spark risk-off behavior across financial markets, leading investors to exit high-volatility assets like cryptocurrencies and equities.
While this bearish view is short-term in nature, it reflects real-time market dynamics driven by sentiment shifts and macro headlines.
Strong Fundamentals Support Long-Term Growth
Despite short-term price fluctuations, Bitcoin continues to demonstrate strong underlying fundamentals that support long-term appreciation.
1. Global Money Supply Expansion
Historically, Bitcoin has shown a strong correlation with global M2 money supply trends. As central banks maintain accommodative policies and governments increase fiscal spending, more liquidity enters the system—often finding its way into decentralized assets like Bitcoin. With money supply growth remaining steady, Bitcoin is well-positioned to benefit.
2. The "Big Beautiful Bill" and U.S. Fiscal Policy
The recently passed House bill—dubbed the “Big Beautiful Bill”—signals a significant increase in U.S. national debt if enacted into law. While still pending Senate approval, such fiscal expansion typically strengthens Bitcoin’s appeal as a hedge against inflation and currency devaluation. Investors increasingly view BTC as digital gold—a store of value amid growing macroeconomic uncertainty.
3. Institutional Demand via Spot Bitcoin ETFs
One of the most compelling drivers of demand is the surge in spot Bitcoin ETF inflows. Last week alone, these funds attracted over $2.9 billion in new capital**, pushing total industry assets above **$128 billion. This level of institutional participation underscores growing confidence in Bitcoin’s legitimacy and long-term viability.
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4. Declining Supply on Exchanges
Another bullish indicator is the continuous decline in Bitcoin supply held on exchanges. When fewer coins are available for immediate sale, selling pressure decreases. Combined with rising demand, this imbalance tends to drive prices higher over time. Network data confirms that holders are moving BTC to cold storage, signaling strong conviction in future price gains.
Technical Analysis: BTC/USD Daily Chart Insights
From a technical perspective, the BTC/USD pair has retreated from its peak of $111,970 to trade below $107,000. The price dropped beneath the critical support level at $109,290, which was previously the all-time high before being surpassed.
However, several positive signals suggest the uptrend may resume:
- Bitcoin remains above both the 50-day and 100-day Exponential Moving Averages (EMAs), indicating that bulls still control the broader trend.
- Pullbacks following new all-time highs are common in crypto markets and often present buying opportunities.
- A successful bounce from current levels could lead to a retest of the $111,970 resistance zone in the coming days.
Traders should monitor volume patterns and momentum indicators like the RSI and MACD for confirmation of a reversal.
Upcoming Catalysts to Watch
Several key events this week could influence Bitcoin’s next move:
- Federal Reserve Minutes (Wednesday): Insights into monetary policy direction may affect risk appetite across markets.
- U.S. Consumer Confidence Data: A gauge of economic sentiment that can impact investor behavior.
- GDP and Personal Consumption Expenditure (PCE) Reports: These inflation-sensitive metrics will shape expectations for interest rates and dollar strength.
Any dovish signals from the Fed could reignite bullish momentum in Bitcoin, while hawkish tones may prolong consolidation.
Frequently Asked Questions (FAQ)
Q: Why did Bitcoin drop after reaching $111,971?
A: The decline followed profit-taking after a sharp rally and was amplified by macro concerns, including proposed U.S. tariffs that triggered a broader risk-off market environment.
Q: Is the Bitcoin bull run over?
A: No. Despite the pullback, key technical indicators and fundamentals—such as ETF inflows and low exchange supply—suggest the uptrend remains intact.
Q: What price levels should traders watch?
A: Immediate support lies at $104,000; defense of this level is crucial. On the upside, $111,970 remains a key resistance to reclaim.
Q: How do spot Bitcoin ETFs affect price?
A: They increase institutional demand and reduce circulating supply, creating upward pressure on prices due to limited availability.
Q: Can macro events really impact Bitcoin?
A: Yes. As Bitcoin evolves into a macro asset, it reacts to global monetary policy, inflation trends, and fiscal decisions—similar to gold or equities.
Final Thoughts
Bitcoin’s recent retreat from record highs is a natural part of its price cycle. While short-term volatility persists due to profit-taking and geopolitical noise, the underlying demand drivers remain strong. With institutional adoption accelerating and macroeconomic conditions favoring scarce digital assets, the long-term trajectory for BTC/USD appears constructive.
Traders should stay alert to technical levels and upcoming economic data while maintaining exposure aligned with their risk tolerance.
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