A correction was inevitable at some point
Against the US dollar (USD), the price of Bitcoin (BTC) has been on a tear in recent weeks, refreshing all-time highs of $73,845. The recent correction, however, has some traders questioning how low the market can drop. Based on the current uptrend, in place since bottoming at $15,581 in late 2022, three corrections emerged, with two of them dropping circa -20.0%. So, knowing the latest correction has already been as far south as -15.0%, should we be anticipating a rebound to the upside to perhaps refresh record highs?
As per the weekly timeframe, support is not expected to step into the fray until $56,796, which happens to be located near another layer of support at $51,952 and a decision point area at $50,619-$53,057. This, coupled with the Relative Strength Index (RSI) recently dropping from its highest overbought value since 2021, hints at a deeper correction this time around.
Meanwhile, price action on the daily timeframe is seen hovering north of a 38.2% Fibonacci retracement ratio at $60,393. Aside from this level, support is thin until the Fibonacci cluster between $51,440 and $53,172 (as a note, this area also houses a 1.272% Fibonacci projection ratio [an ‘alternate’ AB=CD bullish formation as of current price action]).