Bitcoin - Bulls vs Bears: $106k or New ATH?Bitcoin saw a sharp and aggressive drop following Donald Trump’s surprise announcement of a 50% tariff on EU imports. The sudden macro shock triggered broad risk-off flows, with BTC quickly selling off from local highs near 111.3K and tapping into a key fair value gap around 107.5K. Although we’ve seen a short-term bounce since that low, it’s not a convincing bullish reversal. Momentum remains fragile, and the overall structure still favors caution as we trade within a compression zone formed post-drop.
Key Technical Zones
We’re currently trapped between two major 1H fair value gaps that serve as clear boundaries for market direction. The lower zone around 107.5K has provided temporary support, acting as a reaction point after the dump. This FVG was left behind during the early-May rally and is now being tested for the first time. On the flip side, price was rejected earlier today from the upper 1H FVG at 109.8K to 110.7K, which previously served as the base of the last breakdown candle. That rejection confirms sellers are active at that level, and it’s now acting as resistance.
We’re essentially in a deadlock between demand and supply, and the next break will determine directional bias for the next major leg.
Bullish Scenario
If bulls can reclaim the 109.8K–110.7K area with strength and close above it convincingly, that would indicate demand has absorbed the supply in that zone. Ideally, we’d want to see a clear bullish displacement to confirm strength, not just a weak grind. In that scenario, BTC could make its way back toward the previous highs and retest the higher resistance zone around 112K. This level lines up with a larger supply zone and could become a key magnet if the market shifts risk-on again or if shorts begin to unwind.
Bearish Scenario
On the flip side, if BTC fails to hold the lower FVG and breaks below 109K with a strong bearish candle or wick rejection from the upper range, it opens the door for further downside. The next target would be the clean liquidity pool near 106K, which is supported by a price inefficiency and unmitigated demand just below. This level also aligns with prior consolidation structure and would be a logical place for a deeper retracement following the news-driven shakeout.
Market Context and Decision Point
This is a compression structure formed after a high-volatility event, so it’s important not to get trapped in the middle of the range. Price is coiling between two well-defined FVGs, and whichever one gives way will likely trigger the next expansion move. Look for signs of displacement impulsive candles, clean breaks, and follow-through, to validate which side is in control. Until then, patience is key. Let price choose the path and then follow the momentum.
Price Target and Expectations
✅ Break and hold above resistance FVG → target 112K
🚩 Break and lose the support FVG → target 106K
Conclusion
Bitcoin is stuck in a tight battle between bulls and bears following a heavy news-driven drop. The current 1H FVG range offers a textbook breakout setup, with both sides clearly defined. This is not the time to force trades inside the chop. Wait for a clean break, then position for the follow-through. The resolution of this range will likely dictate direction soon, especially as the market continues to digest the macro developments.
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