Bitcoin remained range-bound below $70,000 after repeated failures to secure a daily close above the level, leaving traders split on whether the next decisive move will be higher or lower. Independent analyst “Sherlock” argued on X that a rebound toward $72,000–$76,000 could become a bull trap, describing the zone as a “kill area” where overhead supply may re-emerge.
Range-Bound Below $70K
After a series of bearish corrections, Bitcoin has consolidated in a tight band under $70,000. Some market watchers view the structure as a potential base for another push higher. Others warn that bounces into prior congestion zones risk attracting fresh selling from sidelined holders looking to exit at breakeven.
Analyst Flags $72K–$76K as Potential “Kill Zone”
Sherlock’s caution centers on breakeven dynamics. He argued that a move into the $74,000–$76,000 range could coincide with large holders approaching their average entry prices, historically areas where some investors reduce exposure.
As an example, Sherlock pointed to MicroStrategy’s Bitcoin treasury, citing a reported average acquisition cost near $76,052. He suggested that prices nearing that level could draw out supply from investors at or near breakeven. There is no indication the company intends to sell; MicroStrategy has repeatedly stated its intention to hold for the long term, and Chairman Michael Saylor has said the firm can withstand severe drawdowns, including scenarios where Bitcoin trades below $10,000.
ETF Positioning and Cost Basis Overhang
Sherlock also highlighted spot Bitcoin ETFs as a potential source of overhead supply. He estimated that these funds hold roughly 1.28 million BTC with an average entry between $84,000 and $90,000. According to his analysis, the products have seen more than $6 billion in net outflows since late 2025, and a rally toward their average cost basis could face renewed selling pressure.
He further estimated that about 63% of invested Bitcoin wealth carries a cost basis above $88,000, implying that a subsequent advance toward that area could create another “trap” if holders look to exit at breakeven. These figures and thresholds are Sherlock’s estimates and could not be independently verified.
Key Levels and Current Price
Sherlock framed $72,000–$76,000 as the first area where a bull trap could develop; if surpassed, he sees the next potential supply zone around $88,000. He also cautioned that not every breakeven level triggers selling and markets can still form durable bottoms in the presence of overhead supply.
At the time of writing, Bitcoin was trading around $66,980.