Bitcoin’s bull market may be entering a temporary cooldown as the world’s largest cryptocurrency struggles to maintain momentum above its previous all-time highs. Analysts are warning that a “deeper pullback” could be in the cards before the next leg up, with a $104.5K weekly close now emerging as a critical support level.
BTC Dips Below Key Resistance Amid Profit-Taking
As of May 31, Bitcoin (BTC) is trading around $104,177, down nearly 8% from recent highs, according to Cointelegraph Markets Pro and TradingView data. After hitting a record high earlier this month, the price retraced sharply, now testing support levels first established in late 2024.
The weakness has been attributed largely to profit-taking by long-term holders and high-net-worth investors. According to on-chain analytics firm CryptoQuant, unrealized profits averaged over 30% when BTC hit $111,000 — a level that historically triggers sell pressure.
Whale Activity and Demand Growth Reach Inflection Point
CryptoQuant’s report also notes a slowdown in demand growth, suggesting the bull run may temporarily lose steam. The platform estimates Bitcoin’s 30-day demand growth at 229,000 BTC, close to the 279,000 BTC peak seen in December 2024 — a sign the market could be nearing a short-term top.
Adding to the caution, whale-held BTC balances increased by just 2.8% over the past month, down from previous accumulation levels that supported sharp rallies.
“Some of Bitcoin’s demand metrics may be reaching a short-term top, which could imply a pause in the current rally,” CryptoQuant analysts wrote.
Technical Setup Hints at Deeper Correction
Popular trader Mags shared on X (formerly Twitter) that Bitcoin’s recent rejection below its old all-time high confirms a significant resistance level.
“On the daily chart, BTC has broken below the previous all-time high and is facing rejection at that same level,” Mags said. “This might look like the start of a deeper correction.”
The key level to watch is a weekly close above $104,500 — a line in the sand that could determine whether the current consolidation turns into a longer retracement or a fresh base for the next upward surge.
Cautiously Bullish
Despite near-term headwinds, market sentiment remains broadly bullish over the long term. However, traders are bracing for increased volatility and potentially sub-$100K prices before Bitcoin resumes its upward march into price discovery territory.