In previous analyses, it was noted that Bitcoin, Ethereum, and several leading cryptocurrencies were forming key levels below which Sell Stop orders could accumulate — areas often referred to as liquidity zones that may be targeted during deeper market retracements. This scenario has now materialized as expected.

Bitcoin technical analysis

BTCUSD - 1 Day Time Frame

Bitcoin’s price has declined by approximately 10%, while Ethereum has fallen by over 20%. The focus now turns to identifying potential signals that could indicate the next market direction and evaluating what factors might be considered before any new positioning.

Despite the recent correction, Bitcoin still retains one remaining level of sell-side liquidity below its current position, which could attract short-term price movement. The key condition for confirming a potential bullish setup remains consistent: a daily close above the body of the candle that initiated the liquidity sweep — representing the bearish price delivery. This critical level is illustrated on the attached chart with a horizontal line for clarity.

Bitcoin price target

If this condition is achieved, the bullish setup could be considered technically validated, with the possibility of price extending toward the buy-side liquidity levels located above the current market range. For risk management purposes, a protective Stop Loss could be positioned below the internal low of the ongoing structure.

It is also important to note that the lower sell-side liquidity level may continue to act as a magnetic area for price action. As a result, the market could briefly revisit this zone before any sustainable bullish reversal potentially begins.