Bitcoin at a Crossroads: Will It Break $120K, or Will Ethereum Continue to Lead the Market?

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Bitcoin at a Crossroads: Will It Break $120K, or Will Ethereum...

Dimitar Todorov
13 August, 2025, 17:21
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Bitcoin Faces $120K Test as Ethereum Steals the Spotlight with 230% Surge

Bitcoin (BTC) is once again pressing against the critical $120,000 resistance level after a volatile period in which altcoins — led by Ethereum — have outperformed. While BTC remains near its all-time high, market indicators show mixed signals, raising questions over whether the flagship cryptocurrency can sustain its momentum.

Bitcoin’s Battle at $120K Comes with Mixed Derivatives Signals

According to CryptoQuant data, August marked a key shift in derivatives sentiment. The Bitcoin Futures Power index, which measures the combined influence of open interest, funding rates, and taker order imbalances, fell to zero, ending a string of positive readings that had fueled BTC’s earlier rally.

Top market analyst Axel Adler explained that such a drop suggests cooling momentum in the futures market:

“If the index moves from neutral into negative territory, history shows this has often preceded significant corrections,” Adler warned.

With BTC now trading just below its all-time high of $123,217, the next breakout attempt could determine market direction for the remainder of Q3.

Ethereum’s Rally Reshapes Market Leadership

While Bitcoin’s performance has been strong, Ethereum (ETH) has dominated headlines with a 230% gain since April, driven by:

Institutional accumulation
Reduced exchange supply
Favorable regulatory tailwinds

ETH’s surge has shifted capital and attention away from BTC, creating a more balanced market structure in which leadership is not solely dictated by Bitcoin. This rotation suggests that even if BTC stalls below $120K, large-cap altcoins could sustain broader market bullishness.

Technical Analysis: BTC Consolidates Below Key Resistance

Bitcoin at $120K: Options Expiry Clears Path for $120K Breakout or Consolidation

On the 4-hour chart, Bitcoin is trading at $119,967, up 0.34% on the day. The price has rebounded strongly from early August lows near $114,000 and is now trading above its:

50 SMA ($117,269)
100 SMA ($116,893)
200 SMA ($117,475)

This alignment supports a bullish short-term structure, with moving averages likely to serve as dynamic support on any pullback.

However, repeated rejections near the $123K zone in recent months highlight the importance of this supply area.

Key Levels to Watch

Resistance:
- $120,000 — Immediate psychological barrier
- $123,217 — All-time high and breakout trigger
Support:
- $117,000 — Confluence of 50, 100, and 200 SMAs
- $114,000 — Recent swing low

A decisive daily close above $123,217 could ignite momentum buying and open the door to new price discovery. Failure to break higher, however, may trigger a pullback toward $117K, where multiple technical supports converge.

Market Outlook: Breakout or Cooldown?

With spot prices near record highs but derivatives sentiment cooling, Bitcoin is at a critical crossroads. If bulls can reclaim $123K with conviction, the market could enter a fresh leg higher.

If not, Ethereum and other top altcoins — which are still showing strong inflows — could drive the next phase of market leadership, even as BTC consolidates.

Dimitar Todorov publication: "Bitcoin at a Crossroads: Will It Break $120K, or Will Ethereum Continue to Lead the Market?" was written for 24crypto.news