Bitcoin’s (BTC) ongoing correction below $100,000 could extend to $40,000 based on technical indicators, as highlighted by a trading expert.
According to Alan Santana, Bitcoin has exhibited a ‘lower high’ formation that could foreshadow a continuation to a ‘lower low’ in the asset’s price trajectory, as per his analysis shared in a TradingView post on January 8.
The downward trend has been developing over the past month, with a strong bearish day on January 7 marking the highest volume since December 5. This drop confirmed the formation of a lower high, raising concerns about a potential crash.
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The critical question is whether Bitcoin will find support at $95,000 or $90,000 or if the bearish momentum will push it down to $40,000.
The four-hour timeframe analysis shows a predominance of bearish volume, suggesting that bearish sentiment has been building up.
Despite a brief glimmer of hope for recovery, the aggressive nature of the January 7 drop from $100,000 has cast doubt on the market’s ability to rebound immediately.
Santana noted that while there’s potential for this move to end at a higher low, which would favor the bulls, the current market action suggests a retest of support levels. If Bitcoin stays above $90,000, he believes the market could stabilize, but a break below this level might signal further declines.
Additionally, the analyst reassured investors to remain calm, viewing the current situation as a buying opportunity ahead of a potential bull market in 2025.
Bitcoin faces accelerated selling pressure
As things stand, Bitcoin’s price movement points to the possibility of continuing the current bearish momentum. Notably, on January 8, Bitcoin’s Relative Strength Index (RSI) on the hourly chart plummeted to its most oversold level since the cryptocurrency reached $60,000.
This drop indicates that Bitcoin is experiencing extreme selling pressure, potentially signaling a reversal or a continuation of the bearish trend.
On the other hand, analysis by pseudonymous trading expert Market Maestro reinforced the notion that the current market sentiment is temporary, stressing that the asset is likely to hit a high of $250,000.
He noted that while a correction isn’t confirmed, signs like rejection from the ‘dead cat zone’ and a double-top RSI pattern hint at a possible downside.
From this perspective, the expert mentioned that a weekly close below $94,000 could lead to further drops, with support at $90,000, $83,300, and $76,300. The analyst views levels below $83,300 as buying opportunities and sees any correction as a setup for a stronger rally, dismissing crash fears.
Most of the market is anticipating Bitcoin will rally in the coming days, with a Finbold report stating that prominent online trading expert TradingShot observed that BTC will likely reach $150,000 in the coming weeks.
This projection was premised on the early 2025 technical formation resembling a similar move in 2024, where Bitcoin culminated in a record high of above $73,000.
With the current vocality, investor and author Robert Kiyosaki called on the market to capitalize on the downside and accumulate the asset. He maintains Bitcoin is set to hit a record high of $350,000 in 2025.
Bitcoin price analysis
At the time of reporting, Bitcoin traded at $95,003, down over 3%, while on the weekly timeframe, the leading digital asset is in the red zone, down 3.5%.
In summary, market attention remains on Bitcoin sustaining its price above the $95,000 support, as it offers the ideal chance to reclaim the $98,000 resistance that opens the door to clinching $100,000. With bears seemingly in control, attention should be focused on not dropping below the $90,000 spot.
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