Will Bitcoin Drop Further?

The bullish momentum triggered by Trump's announcement regarding the creation of a special government crypto reserve has quickly faded. Bitcoin and other leading cryptocurrencies are once again showing signs of renewed weakness.

What can we expect from the market in the coming days, and how should investors manage their buying positions? In this analysis, we break it all down.

Daily time frame analysis

BTCUSD - 1 Day Time Frame

As outlined in our previous Bitcoin technical analysis, the price has entered a natural correction phase following a strong rally—a standard market development. For retail investors and traders, it is now crucial to closely monitor how the price behaves within the identified support zone.

The price may dip below the 0.5 Fibonacci level, but the key factor to watch is the weekly candle close. As long as the candle body does not close below the lower boundary of the support zone, the correction remains within a typical retracement structure. However, a close below this level would signal a deeper correction rather than a temporary dip as part of a short-term pullback.

Bitcoin price target

Even if the price closes below the lower boundary of the blue support zone, this does not automatically confirm a long-term downtrend. In this scenario, investors can still maintain a minimal position while ensuring proper risk management.

The final stop-loss order could be placed below the October low, serving as the last safeguard against an extended downturn.

For now, traders and investors should remain cautious and patient, watching for further signals to determine whether this correction presents a short-term discount opportunity or marks the beginning of a larger market shift.