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Since Donald Trump’s election victory on November 5, Bitcoin (BTC) has seen a substantial rally, reaching all-time highs above $108,000. However, this impulse has failed recently, with the cryptocurrency falling below the critical $100,000 mark,
This has led analysts to speculate about a possible deeper correction and some experts believe that Bitcoin could fall to levels around $85,000 or even $75,000 before resuming its upward trajectory.
Is it a temporary setback or the lull before a final wave?
Morecryptoonl Analyst highlights that current market dynamics suggest a substantial probability of Bitcoin advancing towards $85,000. This projection stems from the observation that the recent wave of price action lacked the strength typically seen in uptrends and failed to reach key extension levels.
The “overlapping and corrective nature” of the rally highlighted by the analyst further supports the idea that a significant pullback may be imminent. If this scenario plays out, it could represent the last major correction of the current bull market, setting the stage for a final price surge.
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Technical analyst Rekt Capital offers a contrasting perspective, affirming that the perception of Bitcoin at $75,000 as a favorable entry point is relative to its current price of approximately $97,000.
Rekt Capital further suggests that what looks like a bargain now may not have looked as attractive when Bitcoin was previously at that level.
Despite the bearish sentiment of some experts, others see the recent price correction as an important purchase opportunity. Analyst VirtualBacon argues that the market reaction to Bitcoin’s drop from $108,000 to $96,000 has been “overblown.”
Is Bitcoin preparing for new all-time highs?
virtual bacon affirms That this drop is not indicative of a market collapse but rather a healthy consolidation phase within an ongoing bull market.
Historical data supports this view, as corrections of this nature often precede new highs. Key support levels, such as the 21-week exponential moving average (EMA) around $79,000 and the 200-day EMA near $73,000, remain intact, suggesting that even a brief drop to these levels would not destabilize the overall bullish structure.
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According to VirtualBacon, underlying economic conditions also play a crucial role in shaping Bitcoin’s future. Recent actions by the Federal Reserve (Fed), including a modest rate cut and a cautious approach to monetary policy, suggest a stable economic environment.
While the Federal Reserve continues its quantitative tightening (QT) policy, the expectation is that this will not persist indefinitely. The growing US debt crisis is likely to require a return to quantitative easing (QE), which has historically driven bullish trends in crypto markets.
In short, many consider the recent Bitcoin price drop as a temporary setback and not the end of the bull market. As long as Bitcoin maintains its position above critical support levels, the uptrend will remain intact.
At the time of writing, BTC is trading at $97,720, down 3% over the 24-hour period and down over 2% over the week.
Featured image of DALL-E, chart from TradingView.com
