Bitcoin May End Correction Phase, Eyeing $120K Breakout

Bitcoin (BTC) has been in a consolidation phase since reaching its all-time high of $111,980 on May 22, trading between $100,000 and $110,000. Currently, it is hovering around the $107,000 mark. Despite the sideways action, recent analysis suggests that BTC might be nearing the end of its correction phase.

According to the popular crypto analyst CrediBULL Crypto, Bitcoin is potentially forming a complex Elliott Wave correction pattern labeled as W-X-Y. Within this structure, the current leg is expected to evolve into a contracting triangle, typical of Wave Y corrections, which often marks the final leg before the resumption of the main trend. This triangle is unfolding in five internal subwaves (A-B-C-D-E), each bouncing between converging support and resistance levels. The projected path suggests that Bitcoin could dip slightly toward the $100,000–$102,000 zone before completing Wave E of the triangle.

Once the E wave of the triangle completes, this correction would likely conclude, potentially opening the door to a new bullish impulse. If BTC manages to hold the daily blue shaded and confirm the breakout of the triangle, a fresh rally toward new all-time highs could be next, potentially reaching the $120K+ level. This theory is further supported by a historical Elliott Wave diagram, where similar flat, zigzag, and triangle corrections have previously led to strong upward moves. The current pattern strongly resembles those seen in textbook scenarios.

Bitcoin has shown signs of ending its complex correction phase, with a key emerging pattern suggesting a potential upward trajectory. The cryptocurrency successfully reclaimed its 50-day Exponential Moving Average (EMA), indicating a bullish sentiment. This move is significant as it erases two days of bearish price action, forming a bullish engulfing candlestick pattern. The pattern suggests that Bitcoin remains in a bullish structure but is at risk of temporary corrections. Historically, past bull markets have shown prolonged periods of upward movement, which could be indicative of Bitcoin's future performance.

The recent surge in Bitcoin's price, closing at $107,486, highlights its macro-sensitivity. The cryptocurrency's value is not solely driven by hype but is also influenced by liquidity cycles and broader economic factors. This sensitivity to macroeconomic conditions underscores the importance of monitoring geopolitical events and central bank policies, which can significantly impact Bitcoin's price movements.

Analysts have noted that Bitcoin's limited supply and high demand contribute to its speculative nature. The cryptocurrency's value is maintained by its finite supply, which constantly reduces, and the large amount of demand from investors. This dynamic creates a unique environment where Bitcoin's price can experience sharp upward movements, as seen in its recent performance.

The emerging pattern in Bitcoin's price action suggests that the cryptocurrency could be poised for a significant breakout, potentially reaching $120,000. This prediction is based on the successful reclamation of the 50-day EMA and the formation of a bullish engulfing candlestick pattern. However, it is important to note that this is an analyst's forecast and not a guaranteed outcome. Investors should exercise caution and consider the potential for temporary corrections in the market.

In summary, Bitcoin's recent price movements and emerging patterns indicate a potential end to its complex correction phase. The cryptocurrency's macro-sensitivity and limited supply contribute to its speculative nature, making it a volatile but potentially lucrative investment. As Bitcoin continues to navigate the market, investors should remain vigilant and monitor key indicators to make informed decisions.