Bitcoin has experienced a notable decline of up to 21.40% over the past month after reaching a record high of around $109,300. Despite this drop, some analysts remain optimistic about the cryptocurrency’s future, particularly with an eye on 2025. There is a prevailing belief that the price may not have peaked yet, with certain indicators hinting at a possible retest of the $100,000 level.
Wyckoff Reaccumulation Model
The Wyckoff reaccumulation model provides a detailed perspective on Bitcoin’s price movements. This model includes nine phases:
- Preliminary Supply (PSY)
- Buying Climax (BC)
- Automatic Reaction (AR)
- Secondary Test (ST)
- Spring
- Test
- Last Point of Support (LPS)
- Sign of Strength (SOS)
As of late February, Bitcoin appears to be in the “Test” phase, currently retesting its Spring phase low of approximately $85,950. This phase is crucial for confirming support and setting the groundwork for a bullish continuation toward the Last Point of Support, which is projected to be around $96,780.
Market Observations
Analysts are closely monitoring Bitcoin’s movements within this framework, as a successful retest of the peak near $106,700 could indicate the start of a new upward trend. Historical patterns suggest that similar setups have previously resulted in significant price increases, such as the rise from $53,400 to $74,000 noted in August 2024. This historical context adds credibility to the current analysis, especially as market participants recall the consolidation phase that preceded a breakout following the 2024 U.S. presidential election.
Despite the current price corrections, some analysts express confidence that Bitcoin is likely to undergo another consolidation period before a decisive upward movement. This viewpoint reflects a broader market sentiment that the peak has not yet been reached, suggesting that further price fluctuations may be forthcoming.
Technical Indicators and Support Levels
Technical indicators suggest that Bitcoin could experience further declines in the near term. Weekly charts show that past corrections have often led Bitcoin toward its 50-week exponential moving average (EMA), which is currently around $76,390. This level is significant as it aligns with a multi-year ascending trendline support that has historically limited Bitcoin’s downside since November 2022.
The relative strength index (RSI) reading of 52.65 indicates a neutral market condition, implying that there is still potential for further declines before a rebound occurs. If Bitcoin closes decisively below the support confluence at $76,390, it could trigger a more pronounced sell-off, with potential downside targets identified at approximately $57,690 and $48,170.
Potential for Recovery
On the other hand, if Bitcoin manages to rebound from its interim support zone between $85,000 and $90,000, or from the stronger support confluence near $76,390, it could set the stage for a move toward the sought-after $100,000 mark. This scenario aligns with the Wyckoff model’s Last Point of Support target, reinforcing the notion that a bullish trend may still be possible.
Market participants are acutely aware of the relationship between technical analysis and broader economic indicators. The potential for a parabolic rally in Bitcoin prices has been associated with changes in the M2 money supply, which could further impact investor behavior and market dynamics.
Conclusion
In summary, while Bitcoin’s recent price movements have raised concerns among some investors, the underlying technical patterns and historical precedents suggest that the cryptocurrency may still have potential for growth. As the market navigates this complex landscape, the interplay of technical indicators, macroeconomic factors, and investor sentiment will be vital in shaping Bitcoin’s future trajectory.
📎 Related coverage from: cointelegraph.com
