How Far Will Bitcoin Price Correction Go?

In last week’s analysis, the BITmarkets analyst team portrayed the conditions that could signal a potential correction for Bitcoin. Recent market developments have confirmed this outlook, with the formation of a new resistance zone reinforcing the likelihood of a bearish move.

This evolving structure raises the question: How far could this correction go?

Daily time frame analysis

BTCUSD - 1 Day Time Frame

An analysis of potential price targets reveals key levels that align with anticipated market behavior over specific timeframes. In the short term, Bitcoin faces a critical Sell-Side Liquidity level, which must absorb a significant volume of orders.

If the price breaks below this level, the subsequent price action will offer crucial insights into market sentiment. This presents two possible scenarios.

The first would be a bullish recovery. If Bitcoin exhibits a strong bullish response after dipping below the Sell-Side Liquidity level, this will indicate renewed bullish strength. Such a movement would suggest the correction has likely concluded, and the bullish trend may resume.

The second would be characterized by a lack of bullish momentum. If the price fails to demonstrate significant bullish activity, it points to a higher probability of a deeper correction. This scenario would prompt traders to seek more favorable entry points at lower levels.

Bitcoin price target

From a longer-term standpoint, a decline toward the Fibonacci 0.5 level—representing the Discount Zone—becomes increasingly plausible.

This zone is bolstered by two strong, untested support areas that have yet to rebalance. These zones may act as a magnet for further corrective movements, potentially laying a stronger foundation for future bullish momentum.

On the accompanying chart, a similar pattern from last year is highlighted. During that period, the price exhibited a strong bullish rally, followed by a bearish correction that found support precisely at the edge of the Discount Zone.

This historical precedent suggests that the current setup could follow a comparable trajectory. While short-term market dynamics remain uncertain, the outlined zones provide clear opportunities for traders to develop strategies around potential bullish recoveries or deeper corrections.

Close monitoring of price action at these critical levels will be essential to identifying Bitcoin's next significant move.