Bitcoin is currently trading at $83,000, after bottoming out at $76,800 on Tuesday. The question is whether this is the bottom or is there a deeper correction ahead before the market turns around?
Factors Affecting Bitcoin
Macroeconomic Pressures
The current US administration is facing a record debt, with $8 trillion coming due by 2025. This poses a serious risk of economic instability, affecting global financial markets, including Bitcoin.
Along with that, President Trump's tough tariff policy is increasing tensions with trading partners, leading to the risk of economic growth decline. The US stock market is also weakening, putting pressure on risky investment channels such as cryptocurrencies.
Geopolitical factors and market impact
On the other hand, the war situation between Russia and Ukraine is entering a critical phase. A 30-day ceasefire agreement is being discussed, but Moscow's response is still unclear. If tensions continue to escalate, Bitcoin could become a safe haven, boosting buying demand.
Bitcoin Support Policies
Despite facing many challenges, Bitcoin is also receiving many positive signals from the legislative side. The US Congress is considering a law to protect Bitcoin ownership and trading. Notably, a Strategic Bitcoin Reserve Fund could be established, with a commitment to buy 1 million BTC within 5 years. If this law is passed, demand for Bitcoin will increase sharply, contributing to pushing the price back to its highest level.
Technical Analysis: Where is Bitcoin?
Short-term: Bears Remain in Control
On the short-term chart, Bitcoin remains in a downtrend after failing to break out of the triangle pattern on Tuesday. Currently, the price is testing the bottom of the wedge pattern. If the current support level fails to hold, Bitcoin could continue to decline to the $70,000 area before a strong recovery.
Long-term: Important Support Zone Approaching
If we zoom out to look at the overall market, we can see that the important support zone is between $73,700 and $68,500. The 0.618 Fibonacci of the previous rally is located at $72,000, while the 0.382 Fibonacci also converges at $73,700. This suggests that this could be the price zone that Bitcoin needs to test before bottoming out and entering the next growth phase.
Investment Strategy: Buy or Wait?
- If Bitcoin continues to decline and tests the $70,000 - $72,000 support zone, this could be a good opportunity to accumulate gradually.
- If Bitcoin breaks $76,800 and bounces strongly, it is possible to consider entering early with the expectation of recovering to the previous high.
- In case the price continues to weaken below $68,500, a long-term downtrend may open, and further monitoring is needed before deciding to buy.
Bitcoin is in the midst of major fluctuations in the global financial and political markets. Although there are still risks of a short-term price decline, the long-term outlook remains quite positive if supporting factors such as regulations and institutional demand continue to be strengthened.
