Bitcoin (BTC) Price Corrects 10% Since All-Time High – Dips Under $100,000

Key Takeaways

• Bitcoin (BTC) has fallen over 10% since its all-time high.
• The Bitcoin price is creating a bearish weekly candlestick.
• Is this the end of the bullish cycle or just a short-term drop?

Bitcoin’s price has fallen since its all-time high of $108,353 on Dec. 17. The price fell by 8% from Dec. 18 to 10, culminating in a low of $95,700.

The Bitcoin correction may have been aided by record daily outflows  of $680 million from Bitcoin Exchange-Traded Funds.

Interestingly, previous outflows were led by Grayscale, but this time around, eight different ETFs sold.

Is this the end of Bitcoin’s bull run, or just a short-term retracement on the road to higher highs? Let’s find out.

Bitcoin Price Dips

The BTC price has increased by 120% since Aug. 5, culminating in a new all-time high of $108,100 on Dec. 16.

The upward movement accelerated once the price broke out from a long-term descending parallel channel in November.

The channel existed for 217 days, while the upward movement lasted for 63 days.

When measuring the entire drop since the all-time high, Bitcoin’s high was at the 1.61 external Fibonacci retracement level. This is a likely area for a top.

Additionally, technical indicators show some weakness. The Relative Strength Index (RSI) has generated bearish divergence in oversold territory.

This also happened in the previous market cycle top. However, the Moving Average Convergence/Divergence (MACD) is still increasing and has not generated any divergences yet. The MACD also generated a bearish divergence in the previous cycle.

So, the weekly time frame chart gives mixed readings. While the RSI is bearish, and so is that Bitcoin was rejected at the 1.61 external Fibonacci retracement, the MACD is still bullish, and the upward movement after the channel breakout is too short to be over.

The weekly close will be critical to determine if the Bitcoin correction has started.

Future Bitcoin Prediction

Bitcoin’s long-term count indicates the price is in the fifth and final wave (red) of the upward movement that started in December 2022.

Wave five has extended and has the same length as waves one and three combined (red), meaning that the top could be in according to Elliott Wave Fibonacci extensions.

However, the sub-wave count (white) indicates that BTC is completing wave four and that there is another upward movement left, possibly giving wave five 1.61 times the length of waves one and three combined.

The shorter-term count aligns with the possibility of another upward movement. The count shows a series of 1-2/1-2 structures (white, black, and yellow) that created a parabolic ascending support trend line and extremely extended wave three.

The upward movement may have ended because of the ongoing Bitcoin price decline, which caused a breakdown from the parabolic ascending support trend line.

So, sub-wave four has likely started. A possible target for wave four’s bottom is at $85,825, reaching the 0.382 Fibonacci retracement support level.

However, wave four may also develop into a triangle and move sideways before eventually breaking out. This would more likely create a minor altcoin season and could indicate the short-term Bitcoin correction is over.

Since wave two created a deep retracement, the concept of alternation suggests that wave four will be shallow.

One More High Left

Bitcoin’s price fell sharply after its all-time high, confirming an important Fibonacci extension as resistance. Technical indicators have also begun to show weakness.

While the top may be in, the wave count indicates that Bitcoin will complete another final leg in its upward movement and reach highs near $140,000.