Bitcoin’s price test – Will $98K support hold amid growing caution?

• Bitcoin holds above $98.3K support, but declining Open Interest signals leveraged trader caution.
• Oversold conditions hint at a possible relief bounce, but breakdown below $98K could trigger downside.

Bitcoin’s [BTC] recent price action is now just the slightest bit complicated: while it remains above the critical short-term holder realized price of $98,300, deeper market signals suggest caution.

A sustained decline in the 180-day open interest delta – now in negative territory – indicates growing unease among leveraged traders.

As short-term selling pressure pushes BTC into oversold conditions, will this mark a local bottom, or is further downside on the horizon?

Key support holds

Bitcoin continues to hover above the critical STH realized price of $98,300; the line that separates profit from loss for recent buyers.

As long as BTC trades above this threshold, the market structure remains bullish, with low volatility and room for upside.

The STH-MVRV ratio also remains above 1, reinforcing the idea that short-term holders are still in profit. However, a decisive drop below $98K could trigger a sharper correction.

Leveraged traders step back

While Bitcoin holds strong above key support, the 180-day aggregated OI delta has flipped negative – indicating more leveraged positions have been closed than opened over the past six months.

A combined $11.3 billion drop in Open Interest (OI) across Bitget and CME suggests rising caution in the market. 

Historically, similar pullbacks in OI have acted as precursors to both major rallies (as seen in 2021 and 2023) and sharp corrections (like in 2022).

Adding complexity, Gate.io is reporting inflows—introducing a divergence in exchange data. 

However, if the OI delta fails to rebound meaningfully, Bitcoin could face mounting downside pressure before finding its next bullish leg.

Oversold signals emerge

Despite declining open interest and rising caution among leveraged traders, the latest buy/sell pressure delta chart reveals that Bitcoin has entered oversold territory in the short term.

Such levels have often marked local bottoms or temporary pauses in broader downtrends.

This suggests that while broader sentiment remains cautious, we could see a near-term relief bounce – especially if BTC continues to hold above the $98K realized price.

However, failure to sustain that level may negate any bounce, turning current oversold conditions into the start of a deeper correction.