Technical Analysis Shows Consolidation Near $105,000 Level

TLDR

Bitcoin price tested the $103,200 support zone after declining from $110,500
BTC is now trading above $105,000 and the 100-hourly simple moving average
Bitcoin exchange reserves have fallen to an all-time low of 2.5 million BTC
Institutional accumulation is increasing with large holders steadily adding to their positions
Technical indicators show mixed signals but point to potential upward movement if $106,000 resistance is broken

Bitcoin is currently navigating through a consolidation phase after experiencing a decline that brought its price down to test support at $103,200. The leading cryptocurrency had previously reached highs of around $110,500 before the pullback occurred.

The price is now trading above the $105,000 level and the 100-hourly Simple Moving Average, suggesting that the market is stabilizing after the recent drop.

Technical analysis reveals a bearish trend line with resistance near $105,550 on the hourly chart. For Bitcoin to begin a fresh rally, it needs to clear the immediate resistance at $106,000, followed by a more important barrier at $106,800.

If BTC manages to break above these levels, it could potentially target the $108,000 resistance and possibly reach back toward the $110,000 mark.

On the downside, if Bitcoin fails to overcome the $106,000 resistance, it might face another decline. Support levels to watch include $105,000, $104,200, and the recently tested $103,200 zone.

Exchange Reserves at Historic Lows

A key development in the Bitcoin market is the dramatic decrease in exchange reserves, which have fallen to an all-time low of just under 2.5 million BTC as of late May 2025.

This metric, which tracks the amount of Bitcoin held on centralized exchanges, has been on a steady downward trend even as the price has reached new all-time highs above $111,500.

The divergence between declining exchange reserves and rising prices is considered a bullish sign by many analysts. Historically, lower supply available on exchanges has led to price increases when demand remains strong.

This pattern suggests that fewer holders are willing to sell their Bitcoin, potentially setting the stage for increased volatility as buyers compete for a smaller pool of available coins.

Institutional Buying Pressure

The reduction in exchange reserves coincides with increased institutional accumulation. Large wallet holders with between 1,000 and 10,000 BTC have been steadily adding to their positions, with much of this Bitcoin being transferred to cold storage for long-term holding.

Strategy added 7,390 BTC in May alone, bringing its total holdings to 576,230 BTC. This represents roughly 2.75% of the total Bitcoin supply, acquired at an average price of $69,726.

Other public companies including GameStop and Japan-based Metaplanet have also been actively increasing their Bitcoin holdings.

Spot Bitcoin exchange-traded funds have contributed to the buying pressure, bringing in $5.23 billion in inflows over the past month according to SoSoValue data.

Government interest in Bitcoin is also growing. The UAE and Pakistan have stepped up their accumulation efforts, while U.S. lawmakers are discussing the creation of a national Bitcoin reserve.

From a technical standpoint, Bitcoin’s momentum indicators are showing mixed signals. The relative strength index stands at 52, indicating neutral momentum, while the moving average convergence divergence has turned slightly bearish.

Short-term moving averages suggest some downward pressure, but the longer-term outlook remains positive as Bitcoin trades well above both the 200-day exponential and simple moving averages, which continue to trend upward.

The immediate future of Bitcoin’s price action depends on whether it can recover its short-term moving average of around $106,000. Success could propel the price toward $110,000 or higher, while failure might lead to a decline toward support levels at $98,000 or potentially $94,000.

For now, Bitcoin’s hourly MACD is gaining pace in the bullish zone, and the RSI is above the 50 level, suggesting that momentum may be building for an upward move.

Bitcoin’s next major move will likely be determined by its ability to break through the key resistance level at $106,000. Traders and investors are watching this level closely as it could signal the start of another leg higher in Bitcoin’s ongoing bull market.