Bitcoin Price Forecast: BTC-USD Stuck Near $68K With 70K Ceiling and 56K Downside Risk

Bitcoin (BTC-USD) At A Crossroads Between 75K Ambition And 56K Risk

Price Context And Market Position Of BTC-USD

Bitcoin (BTC-USD) is trading around $68,000–$68,500, roughly 2–4% above the key $66,000 area and well off the early-February flush to $60,000, the weakest level since September 2024. That drawdown left BTC almost 50% below its October record, according to recent macro coverage, underscoring how far the asset has fallen from the last blow-off phase. Over the last 24 hours, BTC has been broadly flat to slightly higher, while ETH-USD sits near $1,980–$1,990, XRP-USD around $1.45, SOL-USD in the $86–$87 range, and DOGE-USD just above $0.10, showing that the broader complex is stabilizing but not in full risk-on mode. BTC’s current band is a decision zone: above the panic low near $60,000, but still below heavy resistance between $70,000 and $80,000, where the previous leg started to break down.

BTC-USD Chart Structure: Descending Channel, Head-And-Shoulders, And A 60.8K Neckline

On the daily timeframe, BTC-USD is still pinned inside a descending channel, printing lower highs and lower lows as price grinds between the upper resistance region near $75,000–$80,000 and the lower demand area in the $60,000–$63,000 zone. Both the 100-day and 200-day moving averages sit above spot, sloping down and acting as dynamic resistance, which means every rebound into the mid-70Ks faces a wall of overhead supply from earlier buyers who are now underwater. On the 8-hour chart, the structure is even more explicit: BTC is forming a head-and-shoulders pattern with a right shoulder building near the $68,000–$69,000 band after failing to retest prior peaks. Between February 6 and February 20, BTC printed a lower high in price but a higher high in RSI, a hidden bearish divergence that signals waning upside effectiveness even as momentum readings tick higher. The neckline of this pattern sits in the $60,800 area. A confirmed close below that neckline would validate the reversal and point to a measured move target near $56,000, implying another 7.5–10% drawdown from the neckline and closer to 15–20% from current levels.

Supply Clusters And On-Chain Cost Basis: 66.8K–65.6K As The Critical Trap Zone

On-chain cost-basis data through UTXO Realized Price Distribution (URPD) shows a dense supply cluster just below spot. The largest block sits above $66,800, carrying about 3.17% of BTC’s circulating supply; a second cluster around $65,636 holds another 1.38%. Together, more than 4.5% of total supply is concentrated under current price between roughly $65,000 and $67,000. That band is a structural weak point: if BTC-USD closes decisively below $66,800–$65,300, holders anchored in that zone face unrealized losses and historically tend to capitulate, turning latent supply into active selling. These clusters line up with a series of short-term support levels flagged by the market: $67,300 as first defense, then $66,500, then $65,300. A clean break through that entire ladder would not just be a minor pullback; it would drop BTC into the neckline area near $60,800, where the head-and-shoulders structure can complete and open the path to the $56,000 projection.

Short-Term Geometry: Symmetrical Triangle Above A 60K–63K Demand Block

On the 4-hour chart, BTC-USD is compressing inside a symmetrical triangle following the violent rejection and rebound around the $60,000 low. The lower trendline slopes up from that low, while the upper trendline caps price under successive lower peaks, creating a tightening range. This triangle sits directly above a broad $60,000–$63,000 demand zone, where strong buying already stepped in once. Price is now nearing the apex of that structure, which statistically precedes a larger volatility expansion. A break above the upper boundary of the triangle would target the $74,000–$76,000 zone, which aligns with the prior breakdown area and the lower edge of the larger $75,000–$80,000 supply block. A break below the lower boundary would quickly expose the $60,000 area again and likely test liquidity under that level, potentially aligning with the head-and-shoulders neckline around $60,800 and setting up the $56,000 downside objective.

Leverage, Open Interest, And Liquidation Risk Around BTC-USD

Derivatives data shows leverage as a central risk factor. After the February selloff, there was a phase of forced deleveraging that flushed a significant portion of overheated long positions, especially on large venues such as Binance, with the estimated leverage ratio dropping in tandem with the move toward $60,000. That reset lowered immediate systemic risk, which is one reason the $60,000–$63,000 band held on first touch. The rebound, however, has already started to rebuild speculative exposure. Open interest climbed from roughly $19.54 billion on February 19 to about $20.71 billion during the bounce, indicating new leveraged positions were opened into the recovery. At the same time, funding rates flipped positive, which means long positions are paying shorts and the derivatives market is skewed toward bullish bets. This combination of elevated OI and positive funding while price sits under heavy resistance is textbook long-squeeze risk. If BTC-USD rolls over from the triangle apex and drops back through $67,300 and $66,500, the forced closure of these leveraged longs can trigger a liquidation cascade, amplifying downside pressure and accelerating any slide toward the $60,800 neckline and then the $56,000 target.

Spot ETF And ETP Flows: Five Weeks Of Outflows Versus A 40% Fair-Value Gap

The flow picture is split between different institutional channels. On one side, spot BTC ETFs have now logged five consecutive weeks of net outflows, a clear sign that a key segment of regulated capital is still scaling back exposure rather than accumulating into weakness. That reduces the passive bid that could otherwise absorb selling when price approaches the major support bands. On the other side, a broader Bitwise study of global exchange-traded products (ETPs) suggests that BTC-USD is trading about 40% below the theoretical “fair value” implied by cumulative institutional flows into these vehicles. Their model ties long-run price behavior to ETP demand and shows the current divergence as unusually wide. Historically, gaps of that magnitude between ETF/ETP participation and spot pricing have tended to close over time, often via sharp upside repricing when risk appetite returns. This is where “insider-type” behavior in the broad sense—large allocators with more information, better execution, and regulated vehicles—matters: when those entities turn from net sellers to net buyers, price tends to re-anchor around their activity, not around short-term retail positioning.

Institutional Versus Retail Positioning: Divergence In BTC-USD Holdings

On-chain breakdowns from analytics providers show a clear split between small and large holders. Wallets with less than 0.01 BTC have been aggressively buying every small dip, adding to balances on virtually every red candle. In contrast, entities holding between 10 BTC and 10,000 BTC—the cohort most aligned with funds, desks, and high-capacity actors—have sold a “huge volume” over the last five weeks. That behavioral divergence is flagged as alarming by on-chain analysts: sustained bullish phases in BTC usually require consistent accumulation by large holders, not small-ticket dip buying while big players distribute. Additional negative signs include declining on-chain transaction volumes, fewer new addresses, and a slowing network growth rate, all of which suggest that genuine user expansion is not keeping pace with the prior bull narrative. At the same time, sentiment has cooled: the number of ultra-optimistic BTC price calls on social channels has dropped, and the 30-day MVRV ratio sits near -6, a level historically associated with an elevated probability of a relief rally rather than an immediate collapse. The message is mixed: structural smart-money distribution argues for caution, while valuation gauges show that late buyers have already taken noticeable pain.

Macro Layer: Warsh, Rates, And BTC-USD’s Shift Away From The Gold Trade

Above the crypto-specific picture sits a tightening macro frame. Kevin Warsh, nominated as the next Federal Reserve Chair, is being priced as hawkish despite having previously praised Bitcoin and calling it a potential store of value similar to gold. BTC is currently almost 50% below its October peak, and the 14% immediate drop after Warsh’s nomination reflects concern that he will prioritize high rates and potentially an aggressive reduction of the Fed’s balance sheet. A faster or deeper quantitative tightening path would drain system liquidity, a regime that historically pressures BTC and other long-duration assets. At the same time, Warsh’s pro-crypto stance and critique of liquidity addiction hint at a longer-term setup where BTC could eventually benefit as a hedge against policy-driven instability. Another macro point is narrative divergence: BTC previously tracked gold during the “debasement trade,” but now trades more like non-AI tech—a group that has underperformed amid higher-for-longer rate expectations. That correlation shift explains both the drawdown and why the latest macro and tariff headlines from the US have not produced the same kind of explosive upside that earlier cycles delivered under heavy stimulus.

Cycle View: Crypto Winter, Halving Dynamics, And Drawdown Depth For BTC-USD

Cycle analysis from Bitwise frames the current environment as part of an ongoing crypto winter that started in January 2025, shortly after the inauguration of Donald Trump. The key point is that the real damage initially came outside BTC and ETH, with broad altcoin weakness leading and only later feeding back into the majors. From that perspective, the February 6 plunge to $60,000 is a major leg of the same cycle, not the final shakeout. Historically, BTC has followed four-year halving cycles, often experiencing 80–90% drawdowns from peak to trough. With large institutions now in the market, Bitwise expects the amplitude of future declines to compress toward 50–60% rather than the old extremes, since institutional and smaller holders operate on different timelines—one group buys when the other sells, softening the blow. That pattern fits the current environment: BTC is down roughly half from its high, large players have already booked heavy losses (including a $19 billion liquidation event in October), but cycle metrics do not yet show the kind of washed-out base seen in prior secular bottoms.

Stagnation And The Risk Of A 10K–20K Deeper Slide In BTC-USD

Macro voices like Lyn Alden argue that BTC rarely forms fast, V-shaped bottoms outside extreme stimulus periods such as COVID. Instead, after a major low, price typically spends extended time grinding sideways or even bleeding lower in a stagnation phase. The current tape fits that script: BTC has bounced from $60,000 but remains stuck under $70,000, with no decisive break of the descending structure. Alden sees room for a further $10,000–$20,000 downside extension during this prolonged digestion, which would put price in a broad $40,000–$50,000 risk envelope if global conditions deteriorate. At the same time, she flags a key potential future catalyst: a peak in AI-related equities. When high-growth AI names stop compounding at the pace implied by current valuations, capital will look for alternative asymmetric bets, and BTC-USD is well positioned to absorb part of that rotation. The important nuance is timing: that rotation is not yet here, and BTC can still probe lower levels before the next secular leg resumes.

DeFi And Structural Adoption As Medium-Term Levers For BTC-USD

Bitwise leadership also highlights DeFi as a sector capable of dragging the entire crypto complex out of the current winter when conditions finally turn. Separate developments point in the same direction: major financial institutions preparing for stablecoin integration, new 24/7 crypto futures infrastructure from traditional exchanges, and a deepening connection between digital assets and legacy rails. For BTC-USD, this convergence matters in two ways. First, it cements Bitcoin’s role as the primary high-liquidity collateral asset in the system, tying its health to the broader DeFi and stablecoin stack. Second, it brings more regulated capital into a structure where ETF and ETP flows already define a significant portion of marginal demand. Once global risk sentiment improves and these channels move from defense back to offense, the 40% “fair value” gap implied by institutional flows becomes a realistic upside magnet over a multi-quarter horizon, even if the next few months remain dominated by range trading and tactical selloffs.

Near-Term Levels To Watch For BTC-USD: Supports, Resistance, And VWAP

From a level-by-level standpoint, BTC-USD faces multiple layers of resistance and a few non-negotiable supports. On the upside, $68,200 is the first area BTC needs to hold and build above to stabilize its short-term structure. A more meaningful recovery requires a sustained break back over the monthly VWAP near $70,000, which approximates the institutional cost basis for this leg. Trading below VWAP means average large entries are currently under water, and that often keeps high-capacity players cautious or biased to trim exposure on rallies. Above $70,000, the next key region is the $74,000–$76,000 zone (triangle upside target and former breakdown area), followed by the $75,000–$80,000 supply block that coincides with the descending channel resistance. On the downside, $67,300, $66,500, and $65,300 are the immediate stepping stones that overlap with the main URPD supply clusters; failures there would confirm that the dense band of realized cost is turning into active selling. A decisive break below $65,000 puts $60,800 and then $60,000 back in play. Losing that neckline opens the technical path to $56,000, which is the head-and-shoulders projection zone.

Stance On BTC-USD: Rating, Bias, And Risk Framing

Taking all these elements together—chart structure, on-chain clusters, leverage, ETF flows, macro risk, and cycle context—BTC-USD does not yet look like a finished bottom. The bounce from $60,000 is credible but sits under downward-sloping moving averages, under the $70,000 VWAP, and directly on top of the largest near-term supply clusters between $66,800 and $65,636. Leverage has rebuilt enough to make a downside break painful, spot ETFs are still bleeding capital, and large holders have been distributing while smaller accounts buy every small dip. At the same time, the market is not in full capitulation mode: MVRV readings around -6, the 40% under-valuation signal versus ETP flows, and the maturing institutional structure argue against a collapse scenario toward the extreme drawdowns of earlier cycles. The balance of probabilities points to continued chop with a real risk of a run at the 60.8K neckline before the next durable leg higher. Rating for BTC-USD from this zone: Hold, with a bearish short-term bias and constructive medium-term potential. That means respecting the possibility of a $56,000 test if the triangle breaks lower and leverage unwinds, while keeping dry capital ready to scale in closer to forced-liquidation levels or on a clean reclaim of the $70,000 VWAP that would signal that larger, better-informed capital is finally stepping back in on the buy side.

That's TradingNEWS