Bitcoin (BTC) is showing renewed market caution as it tests the $110,000 support level, following a minor pullback from recent highs.

Analysts suggest that the cryptocurrency’s next major move will depend on whether it can break above the $125,000 resistance zone, signaling a potential bullish reversal.

BTC Price Holds Key Support Amid Market Volatility

After a week of fluctuating prices, Bitcoin briefly touched $110,600 on October 14, reflecting a 1.4% daily decline amid broader crypto market turbulence. According to Trader Tardigrade (@TATrader_Alan), BTC recently completed a leg in an ascending broadening wedge pattern—a formation typically associated with bullish continuation but historically prone to 58% of downward breaks.

Bitcoin tests key support at $110K, poised for a potential breakout toward a new all-time high. Source: @TATrader_Alan via X

The quote from Trader Tardigrade suggests a potential all-time high above $118,000. However, Bitcoin has already surpassed that level in 2025, reaching around $120,000–$122,000, according to recent market data. This makes the $118K projection appear slightly conservative relative to the latest ATH range.

Bitcoin Valuation: From Fair Value to Expensive Territory

Market observers, including Crypto Currently (@CryptoCurrentYT), have highlighted Bitcoin’s current valuation relative to its 200-week moving average. Last week, BTC dipped into “Fair Value” territory but has since rebounded to the “Expensive” band (100–150% above the 200W MA). Analysts are watching for a push into “Very Expensive” levels, which could indicate euphoria similar to previous market cycles.

Bitcoin rebounds from “Fair Value” to “Expensive,” eyeing a push into “Very Expensive” before the cycle ends. Source: @CryptoCurrentYT via X

“Traders should have a plan that navigates multiple outcomes,” Crypto Currently explained, emphasizing that institutional inflows, Bitcoin ETFs, and macroeconomic factors could alter the typical cycle dynamics.

Technical Outlook: Critical Levels to Watch

BTCUSDT’s daily chart shows that Bitcoin remains inside a rising wedge pattern—a signal of market indecision after the recent “Great Reset.” The 0.236 Fibonacci level near $111,100 has acted as a key support since the October 10 crash.

Bitcoin (BTCUSDT) remains trapped in a rising wedge, holding $111,100 support, with a bullish breakout only likely above $125,800. Source: BeInCrypto via X

For bullish momentum to return, BTC must close daily above $115,100. However, the critical breakout confirmation lies at $125,800. A clean move above this resistance could see Bitcoin challenge $126,200 and even $136,400, based on Fibonacci extensions. Conversely, failure to clear $119,200 may trigger renewed selling pressure, while a drop below $111,100 could push BTC toward $104,500.

On-Chain Insights and Institutional Influence

On-chain data suggests a tentative recovery, but Bitcoin’s trajectory is closely linked to institutional participation. Investors increasingly view Bitcoin ETFs, including those by BlackRock and Grayscale, as vehicles that could stabilize the market while fueling long-term growth.

Bitcoin’s bullish reversal is contingent on breaking above $125,800. Until that level is surpassed, the market structure remains fragile, and traders are advised to manage risk carefully.

Looking Ahead: Bitcoin’s Potential Bull Run

With Bitcoin holding key support and eyeing a breakout, analysts are forecasting cautious optimism. If BTC surpasses the $125,800 resistance, it could mark the beginning of a new bullish phase, potentially pushing prices toward record levels and reigniting interest in Bitcoin investment strategies, Bitcoin market cap growth, and ETF-related inflows.

Bitcoin (BTC) was trading at around $112,710, down 1.79% in the last 24 hours at press time. Source: Bitcoin Price via Brave New Coin

Investors are advised to monitor technical indicators, on-chain activity, and macroeconomic factors closely, as BTC’s short-term price action may determine the broader trend for the coming months