- Bitcoin has corrected from its new all-time high of $125K, dipping below $123K amid weekend volatility and profit-taking.
- Analysts expect a potential 4% pullback toward the $118K level before bullish momentum resumes, driven by institutional demand and the ongoing “debasement trade.”
Bitcoin has entered a retracement phase after reaching a new all-time high (ATH) above $125,000, as weekend trading triggered heightened volatility across crypto markets. With traders debating where Bitcoin’s next support could form, analysts suggest a brief pullback may set the stage for the next leg higher.
According to TradingView data, BTC/USD slipped below $123,000 late Sunday after surging earlier in the day. The rally, driven largely by derivatives market activity, took Bitcoin to new heights before profit-taking and liquidity gaps caused a sharp correction.
Traders Expect 4% BTC Pullback
Market watchers noted that such weekend surges are often followed by rapid retracements due to lower market liquidity and thinner order books. Prominent trader Skew cautioned that the weekend move might have been “bait” for overly bullish traders, noting that shorts began opening positions near the $125K mark.
Passive shorts compounding here
shorts opening here on the consensus that the weekend pump is bait https://t.co/EErcn5Ddfp
— Skew Δ (@52kskew) October 5, 2025
Data from CoinGlass showed increased liquidation activity around the price top, indicating that both long and short traders were caught off guard by the sudden swings.
Meanwhile, trader CrypNuevo highlighted the 50-period exponential moving average (EMA) on the four-hour chart, currently near $118,000, as a likely short-term support.
We could see a 4h50EMA retest—it’s overextended, and you can see similar retests in previous moves, he explained. After that, I’m still favoring longs over shorts from that zone.
Similarly, analyst Rekt Capital drew parallels to earlier market cycles, arguing that Bitcoin’s rejection from $124K was expected and healthy.
The last time Bitcoin rejected from $124K, it preceded a -13% pullback,
he said, adding that a modest 4% correction would still leave Bitcoin’s weekly uptrend intact.
Institutional Demand and “Debasement Trade” Fuel Long-Term Bullishness
Despite the short-term volatility, institutional sentiment remains overwhelmingly positive. Analysts believe the pullback is not a sign of weakness but rather a pause before renewed buying.
Caleb Franzen, founder of Cubic Analytics, noted that Bitcoin’s minimal pullbacks and strong upward spikes indicate institutional accumulation.
When I see this kind of price action, large spikes followed by sustained bids—I see institutions, Franzen said on X.
Adding to the bullish backdrop is the so-called “debasement trade,” a term popularized by JPMorgan analysts to describe investors seeking hedges against fiat currency devaluation. With fears of a weakening U.S. dollar and rising debt levels, Bitcoin continues to attract attention as a store of value alternative.
As of press time, Bitcoin trades around $124,084, down about 1.5% in 24 hours but up strongly over the past week. Analysts agree that any dip toward $118K–$120K could be met with renewed buying, reinforcing Bitcoin’s long-term bullish structure even amid short-term turbulence.