Bitcoin Begins June on Shaky Ground as Bulls Face Critical Support Test

Bitcoin Begins June on Shaky Ground as Bulls Face Critical Support Test

Bitcoin (BTC) is starting June in a precarious position, caught between historic highs and mounting bearish signals. After sealing its highest monthly close ever, the leading cryptocurrency is now grappling with renewed volatility, raising questions about the durability of key bull market support levels.

BTC Holds the Line—For Now

Despite an 8% weekly retracement, Bitcoin managed to close above the crucial $105,000 mark—previously established in December 2024. The weekly candle just narrowly avoided a bearish engulfing pattern, but technical indicators remain unsettling.

A bearish divergence in the Relative Strength Index (RSI) has now emerged, indicating weakening momentum even as prices touched record highs. “Weekly bearish divergence locked in—and a potential bearish retest forming,” warned analyst Jelle on X.

Market Liquidity Favors Upside

Interestingly, liquidity data from CoinGlass reveals a strong concentration of buy orders above current price levels, with trader CrypNuevo suggesting a potential rebound toward $113,000. “Ideally $100K → $113K,” he projected, citing a probable retest of key resistance zones.

Macroeconomic Uncertainty Adds Fuel to Fire

The U.S. labor market and Federal Reserve policy are back in focus, particularly as recent data hint at economic softening. The April PCE inflation reading came in below expectations, highlighting a rare divergence between slowing inflation and persistently high interest rates.

“The short-term Fed funds rate is now the furthest above PCE inflation since before the 2008 crisis,” noted Mosaic Asset in its latest market analysis. This macroeconomic friction has reintroduced speculation around rate cuts, although CME FedWatch data shows minimal expectation for such moves before September.

Chair Jerome Powell is set to address the Fed Board’s International Finance Division anniversary event on June 2, potentially offering more clues.

Dollar Weakness Could Boost BTC

Adding to Bitcoin’s potential upside catalysts is a weakening U.S. dollar. The Dollar Index (DXY) has dropped below 99, with Mosaic warning that further declines could reflect broader concerns over U.S. fiscal stability—a scenario that often benefits Bitcoin and precious metals.

Hodlers and Whales Show Diverging Behavior

On-chain metrics reveal a transitional phase for the market. According to CryptoQuant, stablecoin outflows from Binance exceeded $1 billion in late May, signaling risk aversion among traders. Long-term holders (LTHs) are also dialing down their exposure, with realized cap metrics pointing to decreased accumulation.

“Whether this signals consolidation or renewed momentum depends on how new capital flows in and whether retail buyers can sustain the rally without institutional backing,” CryptoQuant stated.

Meanwhile, whale wallets holding between 1,000 and 10,000 BTC have systematically distributed holdings throughout the recent rally. In contrast, retail investors are increasing their positions—often a late-cycle behavior.

Santiment reported high whale activity near recent tops, interpreting it as classic profit-taking. “These are often reliable reversal signals,” the firm noted, suggesting close monitoring of sentiment shifts is key.

$120K Target Emerges

Despite near-term volatility, analysts are eyeing $120,000 as a plausible local top. Glassnode’s analysis using the MVRV ratio shows Bitcoin currently trading between the +0.5σ ($100.2K) and +1σ ($119.4K) bands—historically a range for pre-top consolidation.

“While BTC is near overheated territory, it hasn’t breached the +1σ level that often triggers widespread profit-taking,” the firm wrote.

As June unfolds, the big question remains: Can buyers step up to solidify support, or will the market retreat under the weight of profit-taking and macro headwinds?