Bitcoin (BTC) analysis: Is the correction over again?

In our analysis yesterday we wrote that there is a good chance that Bitcoin (BTC) could slow down after the recent all-time high of just above $ 126,000. Yesterday we saw the price drop considerably, but the price is now picking up again. Is this the start of a new rise or should we prepare for a further decline? Technical analyst Erik Juffermans from Newsbit takes you through the current market movement.

The expected correction

Yesterday we delved into the daily chart in more detail, and the gist is simple: after a long rise without a long break, BTC has reached new all-time highs. However, a correction would be healthy and this is therefore a scenario to take into account. The big question is how far the decline can continue.

Yesterday we mentioned the $120,000 level, the top of our channel, as the first logical target. Yesterday’s drop brought the price to $120,500. The price has now risen again to approximately $123,000. But it is doubtful whether this increase is sustainable.

Is the decline over?

The four-hour chart below shows the short-term situation somewhat better than the daily chart. We see a nice recovery, but only when the highs around $ 125,000 are broken will there really be a continuation of the upward trend. For the time being, and despite the recovery, everything points to a reversal of the upward trend.

The forecast therefore remains unchanged: The top of the range at 120,000 is a logical price target. But the purple zone between about $117,000 and $118,000 is really an interesting zone for buyers. A rapid decline below 120,000 towards this level is therefore quite possible.

This scenario is indicated by an arrow on the hourly chart below. We can expect an increase towards the trend line before this decline sets in. A break of this trendline would invalidate our bearish scenario.

So in the short term we are equally bearish. But this decline could lay the foundation for the continuation of the long-term trend towards new all-time highs.