Bitcoin is forming a five-wave pattern and could reach $112K before triggering a bounce to higher targets soon.
Volume charts show strong interest below $114K, and support could build near $112K for a sharp upward move.
Indicators like RSI and Stochastic now signal reduced pressure and suggest Bitcoin is preparing a rebound run.
Bitcoin appears to be entering a corrective phase, as recent price patterns suggest a potential Wave 2 retracement near $112,000. The BTC/USD chart on Bitstamp reflects complex wave structures forming between July 15 and July 28. Analysts are closely monitoring a possible drop before the asset resumes its upward trajectory.
Source: Bitcoin,
As of July 29, Bitcoin trades at $117,968 after reaching a local high of $118,251 within the current trading range. Volume profile shows heavy resistance near $117,716 with strong demand visible between $108,600 and $112,000. This area may become critical if Bitcoin completes its current wave structure downward.
A cluster of Elliott Wave labels—(a), (b), (c), and multiple corrective sub-waves—suggests a corrective cycle nearing completion. The presence of the labeled “w2?” box between $112,000 and $114,000 indicates a potential reversal zone. A rebound from this range could launch the next leg toward the $122,866 resistance.
Elliott Waves Suggest Structured Decline Before Reversal
The hourly BTC/USD chart displays an intricate Elliott Wave pattern, showing several corrective moves between mid-July and late July. This includes zigzag formations labeled (a)-(b)-(c) and internal sub-waves marked with letters A to E. The price has followed these formations with notable precision over the past two weeks.
A five-wave downward impulse appears to be developing toward the $112,000–$114,000 support area. Labels (1) through (5) map out this potential drop, ending near the gray “w2?” reversal box. If completed, this could mark the end of a short-term corrective trend and initiate Wave 3 upward.
The chart’s structure suggests BTC may need to fill in lower liquidity areas before continuing its upward path. Volume bars on the right show significant interest building near lower price levels. These price areas may act as springboards for an upcoming bounce.
Volume Profile and Indicators Highlight Key Support
Volume analysis supports the wave structure by showing high activity at lower levels between $108,600 and $114,000. These zones serve as accumulation pockets where traders may anticipate buying opportunities. As the price nears this range, buyers could regain control.
Two oscillators at the bottom of the chart point to short-term oversold conditions. The Relative Strength Index (RSI) and Stochastic RSI have both begun to curl upward, suggesting decreasing selling pressure. This technical setup aligns with a potential bottom formation near the “w2?” region.
The market is also watching the projected path toward $122,866 if support holds. This target corresponds with previous resistance levels and matches the expected Wave 3 completion point. Such a move would validate the broader Elliott Wave count and indicate a strong bullish continuation.
