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After recently hitting a new all-time high, Bitcoin (BTC) has retraced sharply, erasing its rapid gains and sliding back toward last week’s levels. This retreat has reignited concerns among traders and analysts, many of whom believe bearish forces are once again taking control of the market.
Crypto analyst Melikatrader has mapped out two potential scenarios for Bitcoin’s next move. While both begin with a short-term recovery, each ultimately points toward a bearish reversal and renewed downside pressure.
Breaking the Lower Trendline Signals Bearish Momentum
The key technical development highlighted in the analysis is Bitcoin’s break below the lower trendline of its ascending channel. Previously, BTC had been forming higher highs and higher lows inside this channel, signaling a bullish structure.
However, the decisive break beneath that trendline suggests that sellers have begun to overwhelm buyers. This breakdown is widely seen as the first trigger for a potential reversal, opening the door to steeper declines.
According to Melikatrader, any near-term bounce should be viewed with caution, as supply zones just above current price levels could quickly attract heavy selling pressure.
Scenario One: Rally Rejected at $118,000
In the first bearish scenario, Bitcoin stages a brief rally that takes it to the $118,000 zone. This area has emerged as a significant supply region, where large sellers are likely waiting to unload BTC holdings.
If this rally does occur, Melikatrader expects the upward momentum to be capped at this level, with selling pressure outweighing demand. The rejection would then trigger another wave of bearish momentum, sending Bitcoin lower and reinforcing the break from its previous bullish structure.
Scenario Two: Push Toward $119,700 Before Reversal
The second scenario outlines a slightly more extended rally. Here, Bitcoin manages to climb past the first supply wall at $118,000 and continues toward the next resistance level just below $120,000—around $119,700.
This would represent a stronger recovery effort, perhaps fueled by bullish sentiment or short covering. However, the outcome remains the same: the supply zone acts as a ceiling, and sellers ultimately reclaim control. Once this resistance is met, a sharp reversal is expected, mirroring the result of the first scenario.
Shared Outcome: A Drop Toward $115,800
Despite their differences in peak levels, both scenarios share a common bottom. After the rallies are rejected, Bitcoin could crash toward the $115,800 level, which has been identified as the downside target.
This level aligns with retracement zones where sellers are likely to push the market lower, regardless of whether BTC’s short-lived rebound halts at $118,000 or extends toward $119,700.
Such a move would erase much of the optimism surrounding Bitcoin’s recent all-time high, reinforcing concerns that the rally was unsustainable.
Market Sentiment and Broader Outlook
The retracement comes amid a volatile backdrop for the crypto market, with sentiment swinging rapidly between euphoria and caution. Bitcoin’s surge to fresh highs was celebrated as another step in the ongoing crypto bull cycle, but the speed of the correction has sparked fears of a deeper pullback.
Sellers are clearly exerting more influence, and the market’s ability—or inability—to reclaim key support levels will determine whether Bitcoin consolidates or enters a more extended downturn. Analysts caution that traders should watch volume and momentum indicators closely, as these will provide further clues about whether bearish pressure is strengthening.
Conclusion: Short-Term Recovery, Long-Term Uncertainty
While Bitcoin may attempt another rally in the coming sessions, technical indicators suggest that any recovery is likely to be capped by heavy resistance. Both outlined scenarios end with a move back toward $115,800, underlining the risk of further downside.
For traders and investors, this serves as a reminder of Bitcoin’s volatility even at elevated price levels. Whether BTC’s latest retreat becomes a healthy correction or the start of a deeper bear phase will depend on how the market responds to these critical resistance and support zones.
As things stand, the bears appear to be regaining control, and Bitcoin’s path forward may be defined more by defensive maneuvers than bullish breakthroughs.
