As bitcoin experiences a notable sell-off, analysts are closely monitoring three essential price support levels that could significantly influence the cryptocurrency’s near-term direction. Swissblock Technologies has identified the first critical level at $112,000, advising that this price point must hold for BTC to rebuild its strength. The firm employs its proprietary Bitcoin Risk Index, which aggregates on-chain valuation and cost-basis data to assess market volatility. A higher index reading typically indicates risk aversion and potential price fluctuations, while lower or stable levels suggest a more optimistic market sentiment.
On Monday, the risk index was hovering near zero, indicating an underlying optimism despite a 1.7% dip in BTC’s price to $112,600 over the past 24 hours, with temporary lows hitting $111,717, according to CoinDesk data. Swissblock also pointed to $110,000 as a crucial “lifeline support,” referencing historical charts where buyers struggled to maintain BTC above this threshold during the December-January period, establishing it as a vital area for traders to observe.
The third important support level is identified as the “short-term holder cost basis,” currently at $111,400. This metric, defined by analytics firm Glassnode, reflects the average purchase price of wallets that have acquired BTC within the last 155 days. It is considered a pivotal battleground between bullish and bearish market forces; prices maintained above this level typically demonstrate bullish conviction, while sustained trading below it may indicate heightened risks of sell-offs or a shift towards a bearish market structure.
Glassnode further explained that continuous trading below the short-term holder cost basis could signal a transition to a mid- to long-term bearish market environment. Collectively, the three levels of $110,000, $111,400, and $112,000 create a fragile support zone that traders are vigilantly observing as bitcoin maneuvers through this turbulent phase.
