Bitcoin could be vulnerable to a short-term price pullback according to analysis of key technical indicators and on-chain metrics. Bearish divergence in the Relative Strength Index (RSI) currently suggests weakening upside momentum, a signal that has historically preceded price corrections.
Adding potential downward pressure is an unfilled CME futures gap near the $115,000 price level. These gaps often act as magnets for price action, creating conditions for increased volatility as the market potentially seeks to fill this void.
The cryptocurrency is also assessed to have entered a distribution zone. This phase typically indicates a heightened risk of near-term corrections as early investors may begin to secure profits. Supporting this view, key metrics like the Puell Multiple and Spent Output Profit Ratio for Short-Term Holders (STH-SOPR) suggest levels of retail speculation and miner profit-taking have not yet reached historical extremes seen near major tops.
Collectively, these signals point towards a challenging short-term environment for Bitcoin price action, despite the absence of peak capitulation or overly euphoric sentiment.