Bitcoin has returned to a crucial technical level serving as a significant support zone this year. The 50-week Simple Moving Average (SMA), recognized as a baseline for bull markets by traders, reflects a reliable point for potential price rebounds since early 2023.

As of this report, Bitcoin’s price hovers around $111,200, indicating a modest daily gain though still down for the week.

Bitcoin’s Retest of Long-Term Support

Data presented by Merlijn The Trader illustrates that Bitcoin has effectively retested the 50-week SMA repeatedly since 2023, leading to new heights in previous instances. This moving average has become critical for recognizing trend shifts. In early 2022, a breach below this line indicated the beginning of a considerable correction. More recently, the price rebounding to touch this SMA again has caught the attention of traders, all eyes on potential upward momentum. Merlijn noted:

BITCOIN JUST RETESTED THE BULL MARKET BASELINE.

The 50-week SMA marked every major liftoff since 2023.

Smart money buys the retest. Retail buys the breakout. This chart separates traders from tourists. pic.twitter.com/hw8hWmOKPJ — Merlijn The Trader (@MerlijnTrader) October 20, 2025

Sentiment Remains Unsettled After Liquidation

Market confidence remains shaky following a significant liquidation event on October 10. Funding rates, which indicate the cost of holding long or short futures positions, fell into negatives by October 17, suggesting many traders anticipate further declines.

Funding Rates Figure

Funding Rates Source: CryptoQuant

Consequently, funding rates have rebounded back above 0.005, re-sparking interest from buyers, though the remaining cautious sentiment in the derivatives market indicates traders are not fully convinced by this rebound—a typical response after sudden losses, especially post a strong pullback.

Key Price Levels at Play

Bitcoin trades around a resistance area of $111,440. This level initiated a past decline dipping below $108,600. According to Lennaert Snyder, maintaining above $111,440 could pave the way for upward movement toward $115,800, and possibly $120,800 if that too is surpassed, following swift sell-offs earlier.

EGRAG CRYPTO has highlighted that Bitcoin seems to be following a recurrent pattern, suggesting we might be on the cusp of the final stage of an upward cycle while presumably increasing retail participation may precede sharp reversals. They noted:

“Everyone will think we’re finally safe… but that’s where the real twist comes.”

Recent market corrections have been influenced by political developments, including commentary from former US President Donald Trump concerning new tariffs on China, furthering instability in financial markets and pressure on cryptocurrency assets.

In conclusion, traders remain wary, as reflected by prediction data indicating skepticism toward Bitcoin reaching lofty expectations, like hitting $200,000, which seems less likely than other improbable events, such as alien discoveries.