Retail Confidence Contrasts Technical Decline: Bitcoin’s $107K Support Encounters a Critical Challenge

The recent decision by the U.S. Securities and Exchange Commission (SEC) to simplify regulations for cryptocurrency exchange-traded funds (ETFs) has heightened attention on Bitcoin’s price movements. Although retail investors remain optimistic, both liquidity data and technical signals point to the possibility of an extended downturn.

has dropped more than 3% this week, slipping beneath important support thresholds. Order book data reveals a significant liquidity zone around $107,000, which may act as a magnet for price action title8 [ 5 ]. Analysts at Santiment note that a spike in social media chatter about “buying the dip” can often indicate a contrarian trend, as heightened retail enthusiasm sometimes comes before further declines title8 [ 5 ].

Technical signals add to the cautious outlook. Bitcoin’s price has broken through both the 50- and 100-day simple moving averages (SMA), which have flattened for the first time since April. These factors, along with a bearish divergence in the Relative Strength Index (RSI), point to fading upward momentum. On-chain metrics also show a cluster of buy and sell orders near $107,000—a level Hyblock Capital refers to as a “magnet” that could absorb supply and help steady the market if reached title8 [ 5 ]. However, this same liquidity could intensify losses if short-term traders begin to unwind leveraged bets.

The derivatives market introduces further complexity. Open interest in Bitcoin futures has climbed above $220 billion, marking a monthly record, while trading in perpetual futures remains eight to ten times greater than spot trading title9 [ 6 ]. According to CoinGlass, a concentration of positions vulnerable to liquidation above and below Bitcoin’s current price could result in over $10 billion in long liquidations if the price falls to $104,500. On the other hand, a surge above $124,000 could trigger $5.5 billion in short liquidations title9 [ 6 ]. This heightened volatility, combined with upcoming Federal Reserve interest rate decisions, increases the likelihood of sharp price movements.

Past trends also influence the forecast. Since 2013, Bitcoin has recorded losses in eight out of twelve Septembers, with an average monthly drop of 3.77%. Some experts believe that factors like a weakening U.S. dollar and expected Fed rate reductions could offset the so-called “September Effect,” while others caution that institutional withdrawals from ETFs and speculative selling may worsen the downturn. Nonetheless, large holders are accumulating: wallets with more than 100 BTC have reached new highs, indicating that long-term investors are buying the dip.

There is no consensus on Bitcoin’s short-term outlook. Bears expect a possible retest of $100,000, with support at $108,000, $107,400, and $105,500 potentially providing a floor. Bulls, including Fundstrat’s Tom Lee, foresee a recovery to $120,000 by September and a year-end target of $200,000, depending on regulatory developments and broader economic trends. The SEC’s postponed decisions on

and ETFs—now expected in October and November—add another layer of uncertainty, as approvals could introduce new liquidity for altcoins and broaden institutional participation.