Bitcoin has reached a critical juncture: Will support hold, or will the plunge continue?
Bitcoin has reached a crucial juncture. Its recent decline has led the market to test a key support area. The next few days will be crucial to determine whether this is a healthy retest of support or the beginning of a deeper correction. Let's analyze it in detail.
Bitcoin is currently trading within the support range of $112,950 to $101,569.
The most critical price level within this range is $106,590, which coincides with the 38.2% Fibonacci retracement level.
Historically, fourth-wave corrections often reach this retracement level, and Bitcoin is now approaching it.
This area also coincides with the swing highs of December 2024 and January 2025. Interestingly, the January high coincided with Trump's inauguration. Bitcoin attempted a breakout back then, but failed, and subsequently retreated for several months. The market has now reclaimed this level and is retesting it from above.
In the shorter timeframe, two key scenarios are possible:
We first experienced a five-wave decline, known as wave A.
We are now investigating a wave B rebound.
Ideally, the rebound would reach at least $114,780, and possibly even $121,000.
The larger the rebound, the more consistent it is with the broader bullish trend.
This decline is already a complete ABC correction.
If that's the case, we may have entered the next five-wave decline, and support levels will soon be tested.
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