Bitcoin Faces 1.37% Drop, Analysts Predict 10% Correction

Bitcoin (BTC) is currently poised for a significant price correction, potentially dropping below $107,000 before embarking on its next bullish rally. This analysis is based on the current market structure, which indicates a short-term bearish correction within a broader bullish trend. The cryptocurrency market is experiencing a phase where smart money is strategically positioning itself to engineer a liquidity grab and discount entry.

Crypto market expert Tehi Thomas, in a recent analysis, suggested that Bitcoin’s current structure may be entering its final corrective phase. The analyst points to a potential price crash below the $107,000 level as part of a strategic play by smart money. The chart shared by Thomas shows Bitcoin forming consecutive lower highs while its price presses downwards. This pattern, along with a descending trendline, indicates short-term bearish pressure. The trendline appears to be serving as a potential trap designed to engineer a liquidity grab and discount entry.

Once the key zone and sell-side liquidity area around $107,800 is taken, Bitcoin’s price is expected to dip into a nearby Fair Value Gap (FVG), extending down to the $106,500-$106,200 region. This FVG overlaps with critical Fibonacci levels, particularly the 0.786 retracement near $106,200, strengthening the confluence for a potential reversal point. Thomas has highlighted this $106,200 level as a high-probability buy zone, where institutions may re-enter the market. The anticipated price correction for Bitcoin is not seen as a breakdown of structure or market failure, but rather a calculated liquidity grab to fill inefficiencies left from the previous lag. As long as the price respects the $106,000 range and displays bullish order flow afterward, its projected correction is expected to complete the accumulation phase.

Following Bitcoin’s projected sweep and fill of the FVG, the cryptocurrency is expected to form a reversal structure that could kick off the next major rally. Despite the projected crash below $107,000, the overall macro trend for Bitcoin remains bullish. This short-term pullback is considered a setup for a much larger move toward a new all-time high. Thomas’s chart marks the $110,500 zone as the final magnet and ATH target, with a significant layer of untapped liquidity above it. The analyst’s thesis is that once the sell-side pressure is exhausted and displacement confirms the shift in direction, Bitcoin could once again regain bullish momentum. The FVG near $106,200 acts as both a liquidity magnet and a springboard, set to launch the flagship cryptocurrency into price discovery mode once again.

Bitcoin's price has been experiencing significant volatility, with analysts pointing to a potential crash below the $107,000 level. This forecast is part of a strategic play by smart money, which often anticipates market movements and positions itself accordingly. The price of Bitcoin has surged above $109,000, driven by a combination of factors including calls for an interest rate cut and other economic indicators. However, despite remaining stable above $100,000, Bitcoin faces mixed developments regarding future price movements. The price has decreased by 1.37% in the past 24 hours, reaching a low of approximately $107,898. This decline is accompanied by a decrease in trading volume, which has plummeted to its lowest level in over a year. The divergence between price and volume indicates a potential slowdown in the market, which could be due to recent market tensions and fears of a reversal after the price stayed in the upper $100,000 range. This waning activity could be seasonal, caused by a lack of market conviction, or profit-taking. When volume declines while prices rise, the potential for a pullback becomes higher. For the price increase to be more durable, stronger volume support is needed to confirm the possibility of rally sustainability.

Retail investor activity has also been on the decline, with wallets holding between $0 and $10,000 experiencing a 10% drop in demand over the past 30 days. This reduction in retail demand indicates that capital flows are likely shifting to larger wallets, suggesting passive accumulation by whales. Historically, retail investors are most active during market turning points, and their absence at this time could signal that there won’t be massive sales or a surge in demand. This scenario is similar to that of mid-2023, where the decline in retail demand was followed by a 10% correction, followed by a larger breakout. The current pattern, based on recent data, resembles the initial phase of a bullish move as seen in early 2023. As such, there is still room for further upside. Bitcoin’s MVRV ratio stood at 2.26, indicating long-term accumulation. Historically, this level often precedes a major rally. The current pattern, based on recent data, resembles the initial phase of a bullish move as seen in early 2023. As such, there is still room for further upside. BTC’s price strength seems to be maintained as long as the MVRV ratio is above the trendline. On the other hand, OTC balances have also decreased, which hints at a potential supply squeeze as scarcity increases. A drastic reduction in supply usually triggers a rally, provided it is accompanied by demand.