BTC - Will Bitcoin Hold or Fold?

Bitcoin has enjoyed a bullish 2024, reaching an all-time high (ATH) of 108K. However, the recent price action indicates a shift in momentum, with the market entering a phase of consolidation and correction. For the past 40 days, BTC has ranged between 90K and 108K, with the critical psychological level of 100K now acting as resistance. The structure of an ABC corrective pattern following a 5-wave downward impulse suggests the market is transitioning into a short-term bearish phase.

Key Levels and Patterns:

1.) Head and Shoulders Pattern:

• A bearish Head and Shoulders pattern has formed, with 90K serving as the neckline.
  

• Once 90K is broken with significant volume, it will confirm the pattern, potentially accelerating the move downward.
  

• The target for this pattern aligns closely with the previously identified support zone at 84K–80K.
  

2.) Resistance at 100K:

• The psychological barrier of 100K has flipped to resistance, making it a critical level for bulls to reclaim.
  

• A sustained break above 100K with strong volume would indicate a possible trend reversal.
  

3.) Support Zone (84K to 80K):

Multiple confluences align between 84K and 80K:

• Fibonacci Retracement (0.618): The 0.618 retracement level from the recent impulse low to the ATH is at $82,694.88.
  

• Trend-Based Fibonacci Extension: The 1:1 extension of the ABC correction points to 84K.
  

• Anchored VWAP: Calculated from the significant low at 52.5K, the anchored VWAP aligns near 81K.
  

• Fibonacci Speed Fan: The 0.618 speed fan from 52.5K to the ATH intersects around 80K, reinforcing this support zone.
  

4.) Liquidity Below 90K:

• The current range-bound movement has likely trapped many long positions above 100K, creating significant liquidity below 90K.
  

• A breakdown below 90K could trigger a liquidity sweep, driving prices rapidly toward the support zone at 84K–80K.
  

Current Market Dynamics:

• Volume Analysis: Decreasing volume within the range highlights weakening bullish momentum. Confirmation of support at lower levels will require a substantial increase in buying volume.
  

• Bearish Momentum: The head and shoulders pattern, coupled with the ABC correction, signals bearish momentum that may persist into early to mid-January 2025.
  

• Neckline Support at 90K: A break below 90K would confirm the head and shoulders pattern, acting as a catalyst for further downside.
  

Next Steps and Outlook:
Short-Term Bearish Bias: Bitcoin is expected to continue its downward correction, with the head and shoulders neckline at 90K serving as a key pivot point. A confirmed break would likely drive BTC to the 84K–80K support zone.

Long Opportunity at Support: Should BTC reach the identified support zone, it presents a high-probability long setup. Entry should be contingent on confirmation through:

• Increased buying volume.
  

• Bullish candlestick patterns (e.g., hammer, engulfing).
  

• Alignment with key moving averages and other technical indicators.
  

Mid-Term Recovery Potential: After the correction, Bitcoin may resume its bullish trajectory. Key factors to monitor include:

• Reclaiming 100K as support.
  

• Overall market sentiment and macroeconomic conditions.