Bitcoin Price At Risk Of 50% Correction As BTC’s 2022 Bearish Playbook Repeats

As the crypto market recovers from the newest pullback, Bitcoin (BTC) is trying to bounce from its one-month low. Some analysts have warned that the correction has left the cryptocurrency in a “fragile place” that resembles the beginning of the earlier bear market.

Bitcoin Risks 2022-Like Correction

On Sunday, Bitcoin noticed a 3.6% intraday decline, closing the day beneath its yearly opening for the primary time. Since November, the flagship crypto has been hovering between $86,000-$93,500 within the weekly timeframe, failing to show the vary’s resistance into help regardless of a number of makes an attempt.

During the early January breakout, BTC climbed 11.5% from its $87,600 2026 opening worth, reaching a two-month high of $97,924 almost two weeks in the past. Since then, the cryptocurrency has erased all its current good points, diving beneath this key space and shutting the week on the base of its vary.

Amid this efficiency, Market observer Philarekt affirmed that Bitcoin is repeating its 2022 playbook, highlighting the similarities between the main crypto’s efficiency at the beginning of the final bear market and its present worth motion.

As the chart reveals, the cryptocurrency shaped a bear flag sample after the preliminary drop from its cycle prime of $69,000.  At the time, the cryptocurrency examined and rejected the 100-day Moving Average (MA), resulting in a pullback in the direction of the sample’s decrease boundary.

This was adopted by a rebound in the direction of the formation’s higher boundary, the place the 200-day MA was situated, and a rejection from this space, which led to a breakdown from the sample and 55% correction.

This time, Bitcoin has rejected from the 100-day MA and is at the moment retesting the sample’s help line. Based on this, he instructed that the flagship crypto might see another leg up towards the 200-day MA, situated across the $100,000 barrier, earlier than “the actual present” begins.

BTC Price In Precarious Position

Meanwhile, Rekt Capital explained that Bitcoin was in a “significantly fragile place,” because it wanted to carry the earlier week’s marginal shut above the vary high. “When Weekly Closes happen marginally past a key degree, the next retest turns into structurally precarious,” he detailed.

In his evaluation, the market watcher famous that Bitcoin noticed a pointy rejection from the $98,000 area, the place the 21-week and 50-week Bull Market Exponential Moving Averages (EMAs) are situated.

This coincided with the loss of a better low construction that had been constructing equally to 2021. “Losing that Higher Low is critical, because it removes a key structural buffer that would have supported continued consolidation throughout the Weekly Range,” he asserted.

The rejection has shifted focus to the energy of the $86,000 help and the character of the upcoming rebounds from this space. He warned that shallower bounces from the vary lows would recommend weakening demand, rising the probabilities of a breakdown beneath this help.

Strong rejections that result in draw back continuation traditionally are likely to happen later within the cycle towards the tip of Q1 or the beginning of Q2, Rekt Capital identified, however Bitcoin is already testing the decrease boundary of its weekly vary.

This provides “significance to the integrity of this help, as any early breakdown would symbolize a shift relative to that typical timing.” At the second, the weekly vary stays pivotal, “performing as the important thing choice level between a protracted reduction construction and the danger of deeper draw back,” the analyst concluded.