FameEX Hot Topics | Bitcoin Faces Loss of Bullish Momentum: Will $115K Be the Next Target?

Bitcoin is currently showing signs of potential weakness, as indicated by three key charts suggesting the possibility of new weekly lows in July. Although the long-term trend for Bitcoin remains positive, short-term volatility is expected. This suggests that while Bitcoin is still on an overall upward trajectory, there could be minor corrections in the near future that may impact traders.

A critical signal of potential weakness lies in a hidden bearish divergence between Bitcoin's price and the relative strength index (RSI), a key momentum indicator. A hidden bearish divergence occurs when Bitcoin's price continues to make higher highs, but the RSI shows either equal or lower highs. This pattern suggests that the momentum behind Bitcoin's rally is weakening, which often leads to a downside correction. A similar pattern was seen in March 2024, when Bitcoin experienced a 20% drop shortly after such a divergence appeared. This current divergence might result in another corrective move, potentially pushing Bitcoin to new short-term lows.

Another factor contributing to potential weakness is the existence of a CME gap on Bitcoin’s daily chart. CME gaps occur when Bitcoin trades outside the regular trading hours of the Chicago Mercantile Exchange (CME), leaving price gaps that are typically filled during active trading sessions. The current CME gap between $114,380 and $115,635 remains open. Historically, Bitcoin has shown a tendency to "fill" these gaps, and so far, seven out of nine CME gaps in 2025 have already been closed. With this high fill rate, Bitcoin is likely to revisit these levels, leading to a short-term dip that could close the gap around the $114,000 range.

Further signaling the potential for short-term corrections, crypto analyst Gaah pointed out that the Index Bitcoin Cycle Indicators (IBCI) has entered the distribution zone, a region historically associated with market euphoria and temporary market tops. While the index is only at the lower base of the zone (80%), it still signals a heightened risk of correction in the short term. Additionally, key indicators like the Puell Multiple and STH-SOPR (Short-Term Holder Spent Output Profit Ratio) are below mid-levels, suggesting that retail speculation and aggressive profit-taking by miners have not yet reached their peak.

Gaah warned that the IBCI readings indicate a high-risk zone for a potential short-term decline, but emphasized that it does not necessarily signal the end of the current bull market. Rather, it serves as a cautionary signal for traders to prepare for potential volatility before any significant upward movements continue. The behavior of these indicators suggests that while the market is still in a growth phase, corrections could occur in the near term before the next significant move.

Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.