So Bitcoin has already started its usual technical correction following a rejection on the ~$67k top (and new All Time High ( ATH )). The price has broken below its short-term Support, the 4H MA50 (blue trend-line) and is currently being supported by the 4H MA100 (green trend-line). The question on most people’s mind (especially those who bought late at the top on fomo) must be how low can this correction go?
Well one way to answer that is to look at BTC’s rebound following the July 20th bottom of the Q2 accumulation phase, which initiated this Q3 rally. Based on that, the 4H MA100 is the medium-term Support and after July has held 2 times clearly. In fact the 4H MA50/ 4H MA100 range was a mini accumulation zone. Once the 1D MA100 broke (even marginally) on 2 occasions, the price topped soon on the 1.0 Fibonacci level of the Fibonacci Channel Up and started a correction. Initially it was the 1D MA50 (red trend-line) but ultimately it was the 1D MA100 (orange trend-line) that offered the strong buy accumulation.
What do the above information tell us? Well it is possible that as long as the 4H MA100 holds, Bitcoin will trade inside a tight Channel Up within the 1.5 Fibonacci extension and the 1.0 Fibonacci level, until either breaks (break-out continuation signal towards the direction it breaks). If the 4H MA100 breaks, it may be an early signal that we are approaching a top, possibly a second attempt on the 1.5 Fibonacci extension which could be the final rejection. In that case buyers should be ready to buy lower, upon contact with the medium-term accumulation Zone offered by the 1D MA50/ 1D MA100 range. In an arithmetic manner, I expect that ultimately the next High on this pattern will be on the Fib 2.0 extension, i.e. around $85000.