Bitcoin recently touched $123,200 after achieving new record heights above $126,000. Analysts are now closely observing whether $124,000 will become a decisive support level for Bitcoin bulls. Key factors influencing the market include ETF inflows and institutional demand moving forward.

Market Update BTC/USD one-hour chart. Source: Cointelegraph/TradingView

Bitcoin Open Interest at Record Levels

Data from Cointelegraph Markets Pro and TradingView indicates BTC/USD hovered around $125,000 during the Wall Street opening. Following a recent all-time record, there was a small retracement, with prices dipping back to $123,200 before buyers regained momentum.

“Passive selling on Coinbase and taker selling on Binance spot markets resulted in a retreat back to $123.2K,” explained trader Skew in his latest analysis on X.

Skew noted that $124,000 has become the pivotal price point for bullish traders to convert to solid support as Bitcoin attempts to hold its previous all-time high.

“I wouldn’t be surprised to see a fakeout below it, but overall a few weekly closes above $123K are needed. This will pave the way for a 20%-30% surge in the coming weeks.”

BTC/USDT one-day chart BTC/USDT one-day chart. Source: BitBull/X

Trader Daan Crypto Trades noted a sharp rise in open interest across Bitcoin derivative markets, suggesting that a market correction could facilitate sustainable price increases in the future.

“$7B of open interest has increased, which is about +19% of the global open interest added. This isn’t fully aligned with the price rise of +13% during the same period. We can assume there has been considerable speculation from long positions since breaking above $120K,” stated Daan in another post.

“It’s not completely disproportionate, but for a sustained market run, I would prefer seeing a slight reduction in open interest first. If the acceleration continues at this rate, we risk overheating prematurely.”

Institutional Interest Key for Bitcoin Prices

Meanwhile, QCP Capital questioned the sustainability of the current bullish phase in Bitcoin, suggesting potential caution.

“Some may feel the recent 12% rise in BTC seems exaggerated due to the absence of significant catalysts. Yet, the driving narratives surrounding this rally shouldn’t be overlooked,” it expressed.

QCP pointed to factors like the performance of gold and the ongoing US government shutdown as influences boosting Bitcoin’s value, along with Bitcoin reserves on exchanges falling to six-year lows. They concluded that institutional interest would play a crucial role in determining whether the momentum continues upward or moves toward stabilization.

Note: This article does not offer investment advice. It is essential for readers to conduct their own research before making investment decisions.