Bitcoin's Supply Squeeze: $150K Target or Correction?
Bitcoin's Supply Squeeze: A Test for $150K?
The future of Bitcoin [BTC] is a hot topic, fueled by shrinking supply and heightened investor interest. While long-term charts show an upward trend, recent retracement from highs above $120K indicates market unease.
Despite reluctance among holders to sell, resulting in historically high liquid supply, volatility remains a concern. The critical question: Can Bitcoin leverage this scarcity to sustainably push toward $150K?
Key Takeaways
- Bitcoin retraced to the $110K–$112K zone, with MACD signals suggesting weakening momentum.
- Spot Taker CVD data indicates sellers remain dominant.
- Stock-to-Flow ratio highlights long-term scarcity.
Critical Support Zones and Weakening Momentum
Bitcoin's price has retreated to the $110K–$112K support level, just above the 0.786 Fib retracement zone.
This pullback aligns with a bearish MACD crossover, signaling fading momentum after weeks of consistent gains. Failure to reclaim $118.5K resistance exacerbates short-term concerns, as bulls struggle to regain control.
Strong demand around $107K offers some support, suggesting a potential floor. Maintaining levels above $111K is crucial to prevent a further decline toward $105K.
Selling Pressure Persists
Spot Taker CVD data shows that sellers have dominated market flows over the past 90 days. This persistent selling pressure hinders attempts to surpass key resistance levels.
However, limited liquidity means any reduction in selling activity could trigger significant rallies due to scarcity.
NVT Ratio: A Warning Sign?
The NVT ratio has decreased by over 4%, hovering around 31 at the time of writing. This decline indicates that transaction activity isn't keeping pace with Bitcoin's market value, suggesting potentially weaker organic demand.
If on-chain activity doesn't rebound, investors might become wary of overvaluation risks. A recovery in usage is needed to confirm current price levels.
The Power of Scarcity
The Stock-to-Flow ratio has surged 100% to 3.18 million, emphasizing Bitcoin's scarcity as new supply tightens. This metric typically drives long-term valuations higher.
Scarcity remains a core element of the bullish narrative, providing support even during corrections. Despite short-term volatility, the long-term outlook remains positive.
The Road Ahead: $150K or $105K?
Bitcoin's future trajectory depends on navigating the balance between scarcity-driven optimism and short-term market fragility.
If supply remains illiquid and major holders maintain their positions, a climb toward $150K is possible. However, continued selling pressure and weakening momentum could lead to further tests near $105K.
Ultimately, Bitcoin's scarcity is its strongest asset. The market's ability to withstand volatility will determine whether the $150K target is achieved or gives way to another correction.