Bitcoin Stabilizes Above $120K: Consolidation Signals Before Next Breakout

In recent days, Bitcoin (BTC) has reached a new milestone, briefly rising above the $123,000 mark. But despite the optimistic sentiment, the price rally may stall for the time being. Experts expect a consolidation between $120,000 and $130,000. Here’s why.

Dealer Gamma: Options influence the market

A key reason for the expected sideways movement is the so-called “dealer gamma.” According to recent data, market participants trading Bitcoin options are particularly active in the $120,000 to $130,000 range.

Many options traders hold positions that require them to react to both falling and rising prices within this price range—buying Bitcoin when the price falls and selling when it rises. This stabilizes the Bitcoin price within this range, making larger upside or downside swings less likely.

Technical indicators show no weakness for Bitcoin

A look at the key technical indicators also points to consolidation. The Relative Strength Index (RSI) and the Moving Average Convergence/Divergence (MACD) show no signs of bearish divergence.

The moving averages (50-, 100-, and 200-day lines) also remain clearly bullish. This suggests that the uptrend remains intact – albeit without any immediate explosive upward movements.

Macroeconomic conditions are right

The general market situation is currently extremely favorable for Bitcoin. US policymakers are focusing on low interest rates, while stock markets are at record highs.

This “Goldilocks” situation is providing tailwind, but is inhibiting short-term price surges due to already high expectations. Many investors are waiting and preferring to hedge within the current price range.

Conclusion: Patience is required

Even though the signs point to long-term growth, Bitcoin could fluctuate between $120,000 and $130,000 in the coming weeks.

For you as an investor, this means using this time to rethink your strategy and prepare for the next major breakout. Consolidation offers opportunities—especially for those who closely monitor the market.

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(Featured image by beyzahzah via Pexels)

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