Bitcoin (BTC) price prediction: $123,100 potential peak, on-chain indicators suggest "overextension" will pull back

Bitcoin (BTC) reached a new high of $123,100 last week, raising warnings about a potential local top as on-chain indicators suggest overextension, issuing alerts for a price "pullback". Today (21st) in the Asian early session, Bitcoin is reported around $117,300.

The maximum pullback of this bullish round is still only 23.48%, far lower than the 30-80% pullback of previous cycles, indicating that although there are signs of excessive expansion in the short term, the underlying trend structure remains healthy.

Technical analysis shows that Bitcoin is consolidating within a symmetrical triangle pattern, with support levels between 116,000 and 117,000 dollars, and downward resistance around 120,000 dollars.

BTC Technical Analysis: Triangle Consolidation Testing Breakthrough at $125,000

The 4-hour chart of Bitcoin shows consolidation within a symmetrical triangle pattern, with the apex approaching around 117,837 USD.

This pattern forms a compression between the descending resistance level of $116,000 and the ascending support level of $117,000, accumulating energy for a final directional resolution.

This kind of consolidation effect usually precedes a significant expansion of volatility.

A bullish trend breaking through the red trend line could trigger a price increase to $125,000, a rise of about 6% from current levels.

On the contrary, breaking below the green support level may drive the price down to $111,000, which implies a downside risk of about 6%.

This symmetry indicates that neither the bulls nor the bears have attained decisive control.

The multi-level support areas provide a buffer for potential declines, and historically, institutional buying often occurs at these levels.

The final breakout direction is crucial for determining recent momentum and validating continuation or correction scenarios.

(Source: Trading View)

Global liquidity cycle enters the distribution phase

According to Merlijn The Trader, the correlation between Bitcoin and the global M2 money supply indicates that cryptocurrencies have transitioned from the previous phases of "accumulation" and "manipulation" to the "distribution" realm.

(Source: X, Merlin The Trader)

This macro framework indicates that while liquidity expansion continues to support Bitcoin's rise, explosive gains may become more solid and unstable as the cycle matures.

Complex Fibonacci analysis also predicts that the peak cycle time for Bitcoin will occur in October, which means the timeline is longer than the immediate parabolic acceleration.

The resistance zone of 133,665 to 151,539 USD represents the ultimate target, but the path involves multiple consolidation phases rather than linear progression.

Currently, the level of approximately 117,000 to 118,000 US dollars corresponds to a large volume of transactions that have occurred in institutional accumulation and distribution.

This type of technical congestion will create multiple layers of support and resistance, requiring patience to navigate effectively during the distribution phase.