VT 
Bitcoin is currently stabilising as growing investor interest and increased trading activity signal cautious optimism. Although short-term indicators suggest some hesitation, the market seems to be building momentum quietly, preparing for a potential breakout in the near future.
Bitcoin stabilises, keeping traders alert
Bitcoin continues to hover steadily between $116,000 and $120,000, leaving traders cautiously optimistic as the cryptocurrency prepares to gather momentum for a potential breakout.
Overnight, BTC reached a peak of $120,062 before retreating to around $118,300, signalling that the market is digesting recent gains while anticipating the next directional move.
The positive sentiment isn’t driven by price alone. According to CryptoQuant analyst Amr Taha, a fresh influx of $2 billion in newly issued stablecoins entered derivatives platforms earlier today.
This surge in liquidity, mainly through Tether (USDT), is widely seen as a sign of institutional capital moving into the market, setting the stage for leveraged long positions across Bitcoin and major altcoins.
Liquidity and leverage dynamics
Large stablecoin deposits have historically served as a precursor to significant rallies.
When such inflows target derivatives exchanges, they often precede a rise in open interest – a pattern currently unfolding in the market.
Open interest is climbing in tandem with price action, reflecting bullish sentiment and heightened trader engagement.
However, this also increases risk. A rising open interest indicates growing leverage, which can amplify gains in the short term but also intensify losses if market sentiment reverses suddenly.
Technical analysis
Bitcoin has recently slipped into a short-term downtrend after failing to sustain the $120,000 threshold, with a local high of $120,062 followed by a pullback towards $118,000.
Picture: BTC rejected at 120K and losing steam fast, as seen on the VT Markets app.
The MACD indicator reveals weakening momentum through a pronounced bearish crossover and expanding histogram divergence, signalling continued selling pressure in the near term.
BTC’s price has now fallen below the key short-term moving averages (5, 10, and 30 periods), and the recent upward movement looks more like a corrective bounce than a trend reversal.
Broader macroeconomic factors have added to bearish pressures. Fed Chair Jerome Powell reaffirmed the Federal Reserve’s cautious approach to rate cuts this week, while on-chain data from CryptoQuant shows slowing inflows to derivatives exchanges, suggesting a reduced appetite for aggressive leveraged longs.
With a lower high established and $118,000 being retested, bulls must regain control above $119,000 swiftly, or risk BTC revisiting the $117,000–$116,500 liquidity zone.
A local top or just a pause?
Despite indications of short-term fatigue, Bitcoin has yet to experience a sharp pullback.
This resilience suggests solid underlying demand and a market more prone to consolidation than capitulation.
At the time of writing, BTC trades at $119,171, marking a 2.4% increase over the past 24 hours.
With fresh stablecoin liquidity poised for deployment and derivatives traders positioning for further gains, the key question remains whether Bitcoin can push decisively beyond $120,000 or if it needs to shake out weaker hands first.
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