Key TakeawaysBitcoin fell over 4% from its all-time highs, slipping below $122,000, as traders flagged “predatory” market behavior.Liquidity is recovering, suggesting renewed volatility ahead.Analysts see potential support at $117K–$114K, with the 50-day moving average near $114,000 as a key rebound zone.Institutional buying remains steady, but derivatives positioning points to heightened short-term risk.Bitcoin Consolidates After Sudden 4% CorrectionBitcoin’s record-breaking rally took a breather this week, with BTC/USD falling 4.2% in hours to test the $120,000 zone, according to TradingView and Cointelegraph Markets Pro data.The sharp pullback came after multiple consecutive all-time highs, sparking a wave of short-term liquidations and caution across derivatives markets.As open interest surged to near-record levels, traders anticipated a correction to flush out over-leveraged positions.“Very efficient price action — hence the low volatility thus far,” trader Skew noted on X, referring to Bitcoin’s tight consolidation after the pullback.‘Predatory’ Trading Hits Order BooksSkew later pointed to what he described as “predatory price action” from large-volume traders on Binance’s order books — involving spoofing strategies both above and below spot prices.“Clear PvP — predatory price action ongoing via Binance market on BTC,” Skew wrote.“Spoofing on the ask (above spot) and spoofing on the bid (below perps). Aim is to hold or lift price temporarily, then push market lower.”While such tactics often exaggerate short-term volatility, they can also create liquidity traps, shaking out long positions before the market rebalances.By Wednesday morning, data from CoinGlass showed thickening bid-side and ask-side liquidity, suggesting that sidelined buyers were re-entering as volatility normalized.Support Clusters Form Between $117K–$114KTraders are closely watching $117,000–$114,000 as the next potential support range.Analyst ZYN noted that around 190,000 BTC were last accumulated near $117,000, indicating a significant demand zone:“Between $121K–$120K there isn’t much support, but below that, around $117K, we have heavy clusters of recent buyers. That’s where new capital tends to step in.”Material Indicators, which tracks order book data, identified $120,000 as a soft support and $114,000 — near Bitcoin’s 50-day simple moving average (SMA) — as the stronger foundation for a rebound.Similarly, trader Michaël van de Poppe described the dip as a natural correction after the parabolic move:“Bitcoin made a new all-time high, and it’s normal for traders to take profits. My buy zone extends down to around $118,000.”Volatility Builds as Liquidity ResetsDespite the correction, liquidity conditions remain favorable for renewed upside.Exchange order books show restored liquidity depth, while long-term holders and ETFs continue to absorb supply, keeping macro structure intact.Analysts warn, however, that volatility could increase as “predatory” short-term traders exploit market inefficiencies.Still, with institutional inflows and ETF demand supporting the broader trend, Bitcoin’s ongoing correction appears more like a short-term shakeout than a reversal.Short-Term Pain, Long-Term StrengthIf Bitcoin fails to defend $117K, a retest of $114K remains possible — a level that aligns with multiple technical supports and on-chain cost bases.However, market structure remains bullish in the higher timeframes, and analysts broadly expect fresh demand near $114K–$117K to stabilize price action before the next leg upward, according to Cointelegraph.As Skew summarized:“Short-term volatility is resetting leverage, but structurally, the market remains strong — liquidity is back, and bids are thickening.”
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