Bitcoin’s Potential Breakout to $104,000: What to Watch
Bitcoin (BTC) has recently caught the attention of crypto enthusiasts with its bullish setup. Despite a short-term pause, a long-term bullish pattern known as the cup-and-handle may pave the way for a potential breakout to $104,000. This article explores the technical signals, on-chain data, and risks traders should be aware of.
Identifying the Cup-and-Handle Pattern
The cup-and-handle pattern is a classic technical indicator that appears when an asset’s price recovers from a sell-off. It stabilizes into a round “cup” before a shallow consolidation phase forms the “handle.” If the pattern completes, Bitcoin’s next upward trajectory could reach $104,000, with long-term support holding around $89,450.
Currently, Bitcoin’s daily chart shows a rounded bottom, indicating the formation of the “cup.” Recent candles are green; however, upper wicks highlight seller activity, signaling potential price consolidation. While consolidation might frustrate bulls, it’s essential for solidifying structural support above key levels before the next breakout.
On-chain Metrics Favor Accumulation
Data on Bitcoin’s Hodler Net Position Change reveals cautious buying as long-term investors slowly accumulate BTC. Since December 26, hodlers have added approximately 12,349 BTC, suggesting reduced urgency compared to the late-November selling peak of 185,451 BTC. This trend aligns with the handle’s formation and indicates that selling pressure is easing.
Another critical on-chain metric is exchange inflows. Over the last week, inflows dropped significantly—falling from 43,940 BTC on December 31 to just 3,970 BTC by January 5. Reduced inflows indicate fewer Bitcoin holders are sending coins to exchanges to sell, which reflects market confidence.
Leverage Risks and Consolidation Pressure
Derivatives data from Binance shows heavy long liquidation leverage, sitting at $2.24 billion compared to just $416 million in shorts. Traders with leveraged long positions face liquidation risks in the event of minor pullbacks, which could temporarily cap price growth and aid in the handle formation.
This balance between cautious spot buying and leveraged positioning supports consolidation before momentum builds. However, as long as Bitcoin remains above $89,450, the bullish trajectory remains intact. A breakdown below $84,320 could invalidate this pattern and reignite downside risks.
Eyes on Resistance Levels
The first key resistance Bitcoin must break lies near $93,560, followed by $94,710 for confirmation of breakout momentum. If this neckline is breached, the measured move based on the cup’s depth projects a target of $104,000, with a possible stretch to $107,460 if momentum accelerates.
For bullish traders, now is the time to focus on structural setups instead of immediate momentum. Consolidation might take time, but patience could yield significant rewards as Bitcoin gears up for potentially new highs.
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Conclusion
Bitcoin’s price action presents a mix of consolidation signals and long-term bullish setups. With hodler activity supporting limited selling pressure and exchange inflows dropping, Bitcoin continues to set the stage for a new breakout. Watch for resistance levels near $93,560 and $94,710 as indicators for the next leg up. Whether you’re a cautious investor or an aggressive trader, 2026 could bring exciting opportunities in the cryptocurrency market.
