On-Chain Data Tips Bitcoin To Peak At $120,000 – But On This Condition

The cryptocurrency market is a whirlwind of speculation, technical analysis, and evolving fundamentals. Bitcoin, the undisputed king of crypto, constantly finds itself under the microscope. Recent on-chain data and market dynamics suggest a potential peak of $120,000 is within reach, but it hinges on one crucial condition: sustained bullish momentum driven by institutional adoption and favorable macroeconomic conditions.

As of May 18, 2025, Bitcoin (BTC) is trading at $104,887, reflecting a 1.89% increase from the previous close. Stay updated on live price changes here.

Stock market information for Bitcoin (BTC)

- Bitcoin is a crypto in the CRYPTO market.

- The price is 104887.0 USD currently with a change of 1944.00 USD (0.02%) from the previous close.

- The intraday high is 104887.0 USD and the intraday low is 102855.0 USD.

Recent analyses from reputable sources provide insights into Bitcoin's current price action and influencing factors:

1. Technical Analysis: On May 8, 2025, FinanceFeeds reported that Bitcoin broke through the resistance area around $97,500, continuing its upward momentum. The analysis suggests that Bitcoin could rise toward the next resistance level at $100,000, followed by $102,500. This outlook is based on the strength of active impulse waves and bullish sentiment in the cryptocurrency markets. (financefeeds.com)

2. Fundamental Factors: A Medium article from May 2025 highlights several key elements affecting Bitcoin's price:

- Regulatory Developments: Global regulators have become more crypto-friendly. In the U.S., the SEC Chair appointed in April 2025 is known for a pro-crypto stance, and the OCC has allowed national banks to custody crypto-assets without prior approval. In Europe, the EU's MiCA regime standardizes crypto regulations across member states.

- ETF Approvals and Flows: The approval of 11 spot Bitcoin ETFs in January 2024 has led to significant inflows, with net inflows into U.S. Bitcoin ETFs approaching $4.5 billion in January 2025 alone.

- Institutional Investment: Companies like MicroStrategy have aggressively purchased Bitcoin, with MicroStrategy acquiring 15,355 BTC in April 2025, raising its total holdings to approximately 554,000 BTC.

- Macroeconomic Factors: Global liquidity and interest-rate trends have influenced Bitcoin's price. The Federal Reserve began cutting rates in late 2024, and rising U.S. trade tensions have unsettled markets. Analysts note a high correlation between global money supply and Bitcoin's price, suggesting that sustained liquidity expansion could drive new highs. (medium.com)

These analyses indicate that both technical patterns and fundamental developments are contributing to Bitcoin's current price trajectory.

Recent Price Action and Market Overview

Bitcoin's journey to its current price of $104,887 has been a rollercoaster of gains, consolidations, and corrections. Over the past few weeks, BTC has demonstrated strong upward momentum, breaking through several key resistance levels. This bullish trend is primarily attributed to increased institutional adoption, positive regulatory developments, and favorable macroeconomic conditions.

The initial surge was triggered by the sustained inflow of funds into the newly approved Bitcoin ETFs. These ETFs have provided a more accessible and regulated avenue for institutional and retail investors to gain exposure to Bitcoin, further validating its status as a legitimate asset class. Coupled with this, a weakening U.S. dollar and expectations of continued interest rate cuts by the Federal Reserve have contributed to a risk-on environment, benefiting Bitcoin and other cryptocurrencies.

However, the path to $120,000 is not without its challenges. Bitcoin has faced periods of consolidation and minor pullbacks as traders take profits and the market digests the rapid gains. Increased regulatory scrutiny in certain jurisdictions and concerns about the energy consumption associated with Bitcoin mining have also introduced temporary headwinds.

Technical Analysis: Chart Patterns

Technical analysis provides valuable insights into potential price movements. Currently, several key chart patterns are shaping Bitcoin's trajectory:

Ascending Triangle

An ascending triangle pattern has been forming on the daily chart. This bullish pattern is characterized by a flat upper trendline (resistance) and a rising lower trendline (support). The pattern suggests that buyers are becoming more aggressive, pushing the price higher within a narrowing range. A confirmed breakout above the upper trendline (approximately $105,000) would signal a continuation of the upward trend, potentially leading to a test of the $120,000 level.

Bull Flag

A bull flag pattern is also visible on the shorter time frame charts, such as the 4-hour chart. This continuation pattern typically forms after a strong upward move (the "flagpole") and is followed by a period of consolidation (the "flag"). A breakout from the flag pattern would indicate a resumption of the previous uptrend, providing further confirmation of bullish momentum.

Head and Shoulders (Potential Inverted)

While less prominent, there is a potential inverted head and shoulders pattern forming on the weekly chart. This bullish reversal pattern typically appears at the bottom of a downtrend and signals a potential shift in market sentiment. The pattern consists of a head (the lowest point), two shoulders (higher lows on either side of the head), and a neckline (a resistance level connecting the peaks between the head and shoulders). A confirmed breakout above the neckline would suggest a strong bullish reversal and further reinforce the target of $120,000.

Key Support and Resistance Levels

Identifying key support and resistance levels is crucial for understanding potential price targets and risk management. These levels act as psychological barriers for traders, influencing buying and selling decisions.

Key Resistance Levels:

- $105,000: This level represents the upper trendline of the ascending triangle and acts as an immediate resistance. A decisive break above this level would likely trigger a surge towards higher targets.

- $110,000: This is a significant psychological level and a potential area of profit-taking. Overcoming this level would require strong buying pressure.

- $115,000: A further resistance level that could present a challenge to Bitcoin's upward momentum. A successful breach could lead to a rapid move toward the $120,000 target.

- $120,000: The ultimate target, representing a potential peak based on on-chain data and current market conditions. This level will likely face significant resistance as traders anticipate a potential pullback.

Key Support Levels:

- $100,000: This is a crucial psychological level and a strong area of support. A sustained break below this level could indicate a weakening of the bullish trend.

- $97,500: Represents the previous resistance level and now acts as a support zone. This area could provide a good entry point for long positions if Bitcoin experiences a pullback.

- $95,000: Another significant support level. A break below this level could signal a deeper correction and a potential retest of lower levels.

- $90,000: A strong support level and a critical area to watch. A breach below this level could invalidate the bullish outlook and suggest a potential bear market.

Technical Indicators: Analyzing Market Momentum

Technical indicators offer additional insights into the strength and direction of price trends. Analyzing these indicators in conjunction with chart patterns and support/resistance levels can provide a more comprehensive understanding of the market.

Moving Averages

Moving averages are used to smooth out price data and identify trends. The relationship between short-term and long-term moving averages can provide valuable signals. A golden cross, where the 50-day moving average crosses above the 200-day moving average, is a bullish signal indicating a potential long-term uptrend. Conversely, a death cross, where the 50-day moving average crosses below the 200-day moving average, is a bearish signal suggesting a potential downtrend.

Currently, Bitcoin's 50-day moving average is well above the 200-day moving average, confirming the ongoing bullish trend. However, traders should also watch for potential crossovers, as these can signal shifts in momentum.

Relative Strength Index (RSI)

The Relative Strength Index (RSI) is a momentum oscillator that measures the speed and change of price movements. It ranges from 0 to 100, with readings above 70 indicating overbought conditions and readings below 30 indicating oversold conditions. An RSI reading above 70 suggests that the price may be due for a correction, while an RSI reading below 30 suggests that the price may be due for a bounce.

Currently, Bitcoin's RSI is hovering around 65, indicating that it is approaching overbought territory but not yet signaling a significant pullback. However, traders should be cautious and monitor the RSI closely for potential divergence, where the price continues to rise but the RSI starts to decline. This divergence can be a warning sign of weakening momentum and a potential correction.

MACD (Moving Average Convergence Divergence)

The Moving Average Convergence Divergence (MACD) is a trend-following momentum indicator that shows the relationship between two moving averages of a price. The MACD line is calculated by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA. A signal line is then calculated as a 9-day EMA of the MACD line. Buy signals are generated when the MACD line crosses above the signal line, and sell signals are generated when the MACD line crosses below the signal line.

The MACD is currently showing a bullish crossover, with the MACD line above the signal line, confirming the upward trend. However, traders should also monitor the histogram (the difference between the MACD line and the signal line), as a decrease in the histogram can signal a weakening of momentum.

Trading Volume

Trading volume is an important indicator of market participation and the strength of a trend. High trading volume during an uptrend confirms the bullish momentum, while low trading volume can indicate a lack of conviction and a potential reversal. Analyzing the volume in conjunction with price movements can provide valuable insights into the sustainability of the trend.

Recent Bitcoin price increases have been accompanied by relatively high trading volume, suggesting that the bullish trend is supported by strong buying pressure. However, traders should monitor the volume closely, as a decrease in volume during an uptrend can be a warning sign of weakening momentum.

Fibonacci Retracement Levels

Fibonacci retracement levels are horizontal lines that indicate potential support and resistance levels based on Fibonacci ratios. These ratios are derived from the Fibonacci sequence, a mathematical sequence where each number is the sum of the two preceding ones (e.g., 0, 1, 1, 2, 3, 5, 8, 13, 21, etc.). The most commonly used Fibonacci retracement levels are 23.6%, 38.2%, 50%, 61.8%, and 78.6%.

Applying Fibonacci retracement levels to recent Bitcoin price swings can help identify potential areas of support and resistance. For example, the 38.2% retracement level from the recent high to the previous low could act as a potential support zone, while the 61.8% retracement level could act as a potential resistance zone.

Market Sentiment and Fundamental Factors

Market sentiment and fundamental factors play a crucial role in influencing Bitcoin's price. Positive news and developments can boost market confidence, while negative news and events can trigger fear and uncertainty.

Currently, market sentiment surrounding Bitcoin is generally positive, driven by factors such as:

- Continued ETF inflows: The sustained inflow of funds into Bitcoin ETFs has boosted market confidence and provided a steady source of buying pressure.

- Increasing institutional adoption: More and more institutions are investing in Bitcoin, further validating its status as a legitimate asset class.

- Favorable regulatory developments: Positive regulatory developments, such as the approval of Bitcoin ETFs and the adoption of crypto-friendly policies in certain jurisdictions, have improved market sentiment.

- Macroeconomic factors: A weakening U.S. dollar and expectations of continued interest rate cuts by the Federal Reserve have created a risk-on environment, benefiting Bitcoin and other cryptocurrencies.

- Bitcoin Halving Events: The periodic halving events that reduce the rate at which new bitcoins are created typically trigger a bull market as supply decreases.

However, it is important to be aware of potential risks and negative developments that could impact market sentiment, such as:

- Regulatory uncertainty: Regulatory uncertainty in certain jurisdictions could create headwinds for Bitcoin and other cryptocurrencies.

- Security concerns: Security breaches and hacks could undermine market confidence and trigger a sell-off.

- Competition from other cryptocurrencies: The emergence of new and innovative cryptocurrencies could challenge Bitcoin's dominance in the market.

- Energy consumption concerns: Concerns about the energy consumption associated with Bitcoin mining could lead to negative press and regulatory scrutiny.

Potential Trading Strategies

Based on the current technical and fundamental outlook, traders might consider the following trading strategies:

- Long positions: Traders who are bullish on Bitcoin may consider taking long positions, either by buying Bitcoin directly or by investing in Bitcoin ETFs. Potential entry points could be near support levels, such as $100,000 or $97,500. Stop-loss orders should be placed below these support levels to manage risk.

- Breakout strategy: Traders may consider waiting for a confirmed breakout above the resistance level of $105,000 before taking a long position. This strategy aims to capitalize on the potential surge in price following a breakout.

- Pullback strategy: Traders may consider waiting for a pullback to support levels before taking a long position. This strategy aims to enter the market at a more favorable price and reduce risk.

- Short positions: Traders who are bearish on Bitcoin may consider taking short positions, either by selling Bitcoin directly or by shorting Bitcoin ETFs. Potential entry points could be near resistance levels, such as $110,000 or $115,000. Stop-loss orders should be placed above these resistance levels to manage risk.

It is important to note that trading strategies should be tailored to individual risk tolerance and investment goals. Traders should always conduct their own research and consult with a financial advisor before making any investment decisions.

Short-Term Price Analysis

In the short term, Bitcoin's price action will likely be influenced by the following factors:

- Breakout above $105,000: A sustained break above this level would likely trigger a surge towards the $110,000 and $115,000 levels, with the ultimate target of $120,000.

- Consolidation between $100,000 and $105,000: If Bitcoin fails to break above $105,000, it may consolidate within this range for a period of time before making its next move.

- Pullback to $97,500 or $95,000: A pullback to these support levels could provide a good entry point for long positions. However, a sustained break below $95,000 could signal a deeper correction.

Bullish Scenario

In a bullish scenario, Bitcoin breaks above $105,000 and continues its upward momentum, reaching the $110,000 level within the next few days. A successful breach of $110,000 leads to a rapid move towards $115,000, and ultimately, the target of $120,000 is achieved within the next few weeks. The RSI remains below 70, indicating that the price is not yet overbought, and trading volume remains high, confirming the bullish momentum.

Bearish Scenario

In a bearish scenario, Bitcoin fails to break above $105,000 and experiences a pullback to $100,000. A sustained break below $100,000 leads to a deeper correction, with the price falling towards $97,500 or even $95,000. The RSI falls below 50, indicating weakening momentum, and trading volume decreases, suggesting a lack of conviction among buyers.

YouTube Video Analysis

Here are two recent YouTube videos that offer price analysis for Bitcoin:

Video 1: Crypto Market Crash: HUGE Warning for Investors! | Shocking Bitcoin & Ethereum Price Prediction

Watch Video

Video 2: You Just need 0.1 Bitcoin to be a Millionaire: Michael Saylor

Watch Video

Conclusion

Bitcoin's potential to reach $120,000 hinges on sustained bullish momentum driven by institutional adoption and favorable macroeconomic conditions. While technical indicators and chart patterns suggest a positive outlook, the cryptocurrency market remains inherently volatile and subject to unforeseen risks. Traders should conduct their own independent research, carefully consider their risk tolerance, and use appropriate risk management strategies before making any investment decisions.

Ultimately, the future price of Bitcoin remains uncertain. However, by understanding the key technical and fundamental factors influencing its price, traders can make more informed decisions and navigate the volatile cryptocurrency market with greater confidence.