Bitcoin is testing the $100,000 mark amidst volatility caused by US selling pressures. Despite hitting $99,500, concerns arise over a possible bull trap. Traders are analyzing liquidity and RSI signals for insights on the market’s direction, while the weakening US dollar may provide a supportive backdrop for BTC’s performance.
Bitcoin (BTC) is currently testing the critical $100,000 threshold, with bulls struggling amidst volatility triggered by US sellers, especially visible at the Wall Street market opening on February 21. The price briefly reached $99,500 on Bitstamp, marking a notable high for the month. However, Bitcoin’s selloff pattern upon Wall Street’s arrival hints at instability, contrasting with the positive momentum seen earlier in Asian and European markets influenced by favorable US jobless claims.
Material Indicators discussed the evolving dynamics of BTC liquidity, suggesting that recent market movements might rally from the last dip driven by large investors, known as “purple whales.” They cautioned whether this situation could morph into a bull trap or represent a genuine breakout, emphasizing the importance of monitoring liquidity around the $100,000 mark.
Trader CRG signaled a fierce contest at Bitcoin’s multimonth trading range midpoint. He described bears making a stand while maintaining a generally positive market outlook. Similarly, Rekt Capital shared his observations of a bullish divergence in Bitcoin’s daily Relative Strength Index (RSI), noting it had broken its downtrend since late January 2025, generating optimism among traders.
The weakening US dollar, reflected in the decline of the US dollar index (DXY) to 106.38, is also influencing Bitcoin’s outlook. David Burrows, from Barometer Capital Management, pointed out the dollar’s transition from an overbought state historically coincides with strong performance in equities and commodities. The current trend appears to lean in a similar positive direction for Bitcoin.
As Bitcoin stands at the $100,000 crossroad facing volatility from both market dynamics and the US dollar’s shift, traders are closely scrutinizing whether the current momentum will sustain or collapse as a mere bull trap. The situation remains fluid, requiring vigilant observation of liquidity patterns and indicators like Bitcoin’s RSI to navigate the uncertain terrain ahead.
Original Source: cointelegraph.com
