Bitcoin At $105,000: Bull Market Correction Or Bear Market Beginning?

by Murtuza J Merchant Benzinga Staff Writer

Zinger Key Points

Corporate inventories stagnated while core capital goods orders fell 1.3%, signaling declining business confidence and investment.
Regulatory shifts in the U.S. and Russia signal growing institutional crypto adoption, despite volatility and macroeconomic fragility ahead.
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Bitcoin BTC/USD has entered its first meaningful correction in nearly two months, falling from an all-time high of $111,880 amid rising macroeconomic uncertainty and unprecedented leverage in derivatives markets.

What Happened: The pullback marks a pivotal moment for investors, as mounting sell pressure, profit-taking by seasoned holders and surging options activity point to elevated volatility ahead.

The correction coincides with rising macroeconomic risk and increasingly aggressive positioning in the derivatives market.

One of the key catalysts was a surprise legal decision in the United States, where the Court of Appeals temporarily halted a ruling against government-imposed tariffs.

The move triggered a spike in 30-year Treasury yields above 5%, prompting a broad sell-off across risk assets, including cryptocurrencies.

Bitcoin’s options market reflects this nervousness.

Open interest on BTC options reached a record $49.4 billion, according to Bitfinex Alpha, highlighting increased institutional activity and growing demand for both speculation and downside protection following the recent all-time high.

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Why It Matters: On-chain metrics add further cause for caution.

The Relative Unrealised Profit index has exceeded +2 standard deviations, a level historically associated with short-term market tops and intraday volatility.

According to Bitfinex analysts, this reflects a market entering an overheated phase, driven in part by profit-taking from long-term holders.

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Broader macroeconomic indicators are also flashing warnings. U.S. consumer spending declined sharply in April, with households prioritizing savings amid concerns over inflation and future tariff-related costs.

Imports fell nearly 20% in the same month, shrinking the trade deficit by 46%, yet corporate inventories and capital goods orders remained weak, signaling reduced investment appetite.

Labor market data is no more reassuring. Jobless claims are now at their highest levels since 2021, and corporate earnings fell in the first quarter.

Business confidence has slipped, and hiring plans are being scaled back.

Even a temporary trade truce between the U.S. and China has failed to restore lasting confidence.

Despite the pullback, crypto adoption continues to gain momentum in traditional finance.

Meme-stock giant GameStop GME allocated $513 million to Bitcoin as part of a strategic diversification move.

While notable, the decision has sparked concern among investors about the firm's limited crypto expertise and the volatility of the asset class.

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