Bitcoin has seen a sharp rise in recent days, dropping from $118,000 to $113,000, breaking through the key support area between $115,000 and $116,000. However, despite its short-term weakness, Bitcoin is still trading above its 200-day simple moving average and maintains a notable increase since the beginning of the year. Let's analyze the chart to see why this could be a healthy correction rather than a bearish reversal.
BTC/USD daily chart - TradingView
Technical levels and key indicators
Support has just been broken: the price has dropped to just below $116,000 (the orange line), and former support has turned into resistance.
Current price: ~$113,932
50-day simple moving average: ~$112,110 (remains the immediate support level)
Next major support: ~$111,350 (horizontal structure)
200-day simple moving average: ~$99,280
Relative Strength Index (14): Bounced from 45.12, indicating a neutral area - not oversold yet.
The decline is notable, but Bitcoin is still well above the 200-day simple moving average, maintaining its long-term upward trend. The Relative Strength Index is also recovering from its recent lows, indicating that sellers may be losing momentum.
Bitcoin Analysis: Recommended buying areas
For those looking to buy the dip or scale in:
Range $112,000 – $111,000
This is a key intersection between the support level: the 50-day simple moving average and the current price structure. As long as the price of Bitcoin remains above this level, it could be a low-risk buying area.
Range: $100,000 – $99,280
Strong psychological and structural support, backed by the 200-day simple moving average. If the price of Bitcoin drops this deep, strong accumulation is expected.
$75,000 (extreme scenario)
This represents a 35% decline from recent highs - ideal for a long-term investment target if the overall situation worsens.
Bitcoin Price Forecast: Watch these areas for exit or risk management
$116,000 – $118,000
It has just lost support. If the price of Bitcoin retreats to this area but does not hold, it could turn into a bullish trap. So, exercise caution.
Drop below $111,000
If the BTC price closes below this level on high trading volume, we expect the price to drop to $100,000 or lower.
Final thoughts: Will the price of Bitcoin recover?
Bitcoin is undergoing a positive correction, and while short-term sentiment has turned cautious, its long-term structure remains intact. Unless the price of Bitcoin drops below $100,000, this decline could be one of the last major buying areas before resuming the upward wave. Speculative investors, institutions, and long-term investors are likely to closely monitor the $111,000 and $100,000 levels. You should too.