Market Review: Bitcoin Experiences Sharp Decline, Short-Term Recovery Still Uncertain

Recently, the Bitcoin market has undergone a sharp decline, with prices significantly retreating from their highs, reaching a low of $86,050.99, which is over a 13% correction from the previous high of nearly $100,000. The current price hovers around $88,391.87, showing some short-term rebound, but overall market sentiment remains cautious.

This round of decline has not only affected Bitcoin but has also impacted the entire cryptocurrency market to varying degrees. Mainstream altcoins have also retreated, and market funds are flowing more conservatively, with some investors choosing to wait and see, while others are beginning to attempt bottom-fishing, leading to a short-term consolidation trend.

A common question in the market is: Has this round of decline ended? Does the short-term rebound have sustainability? Will Bitcoin return to a strong range?

We will conduct a detailed analysis from multiple dimensions, including candlestick patterns, fund flows, and technical indicators, and explore the possible directions of the market.

Candlestick Pattern Analysis: Short-Term Bottom Formation? Or Continuation of Decline?

1. After the waterfall decline, initial signs of short-term stabilization appear

Recently, Bitcoin has experienced a waterfall decline, with candlesticks showing consecutive large bearish candles, and it briefly fell below the key psychological level of $90,000, showing signs of stopping the decline after reaching a low of $86,050.99. From the current candlestick view, Bitcoin has found some support in the $86,000-$87,500 range, indicating a short-term rebound demand, but the battle between bulls and bears remains intense.

2. Bollinger Bands Indicate Short-Term Support, but Rebound is Limited

From the Bollinger Bands perspective:

• The price has rebounded in the lower band area, forming an initial recovery signal;
• The upper middle band (at $90,300) still constitutes strong resistance; if it cannot be effectively broken, it may continue to face downward pressure;
• If it can break through the middle band, the short-term rebound target could be seen in the $93,000-$95,000 range.

3. Key Support and Resistance Analysis

Support Levels:

• $86,000 (short-term low support): If this level is broken, market panic may intensify, further probing down to $83,000 or even lower.
• $80,000 (psychological level): If this area is breached, Bitcoin may enter a deeper adjustment.

Resistance Levels:

• $90,300 (Bollinger middle band + previous support turned resistance): If this level can be broken, the market may enter a rebound phase, with short-term targets pointing to $93,000-$95,000.
• Above $96,000: A densely packed area of large sell pressure, breaking through this level is challenging; only if it can effectively stabilize above this level can it hope to recover to $100,000.

Fund Flow Analysis: Large Fund Movements Explained

1. Increased Trading Volume, Clear Bottom Support

Recently, trading volume has significantly increased around the $86,000 mark, indicating that funds are supporting at lower levels;

However, there has not yet been a sustained increase in trading volume; if the volume does not further release in the coming days, the rebound momentum may be insufficient.

2. VPVR Volume Distribution: Key Chip Range

From the VPVR (Volume Profile Visible Range) perspective:

• The $86,000-$87,500 range has accumulated a significant amount of chips, forming a short-term support zone;
• The $93,000-$96,000 range has a large amount of historical trading, indicating strong sell pressure in this area; if Bitcoin cannot effectively break through with volume, the rebound may be limited.

3. Order Flow Data Shows Short-Term Fund Inflow, but Still Not Reversing the Major Trend

Recent on-chain data shows that some large buy orders have entered the $86,000-$88,000 range, indicating that funds are beginning to attempt bottom-fishing;

However, large-scale fund inflows have not yet appeared, and the market trend remains unclear.

Key Technical Indicator Analysis: Trend Signal Interpretation

1. MACD (Trend Judgment)

Currently, the DIF line is -1029.68, and the DEA line is -1310.07, still in the bearish zone; the green bars have increased, but a clear golden cross signal has not yet formed. If the MACD forms a golden cross in the coming days, the rebound may be further confirmed.

2. RSI (Relative Strength Index)

The current RSI is 41.00, still in the weak zone, and has not entered the strong zone; the RSI needs to break above 50 to confirm that the market has entered a strong rebound.

3. OBV (On-Balance Volume)

OBV is still in a downward trend, indicating limited market fund inflow; if OBV continues to weaken, it suggests that market funds remain cautious, and future trends may still hold uncertainty.

Today's Market Forecast and Investment Strategy

Short-Term View: Focus on the Key Resistance Zone of $88,500-$90,300

• If Bitcoin can stabilize above $88,500 and break through $90,300, a short-term rebound towards the $92,000-$93,000 range is expected;
• If it cannot break through $90,000, it may enter a consolidation phase between $86,000-$90,000;
• If it falls below $86,000, market panic may intensify, further probing down to $83,000 or even $80,000.

Medium-Term Risk: Bearish Trend Not Yet Reversed

If it breaks above $93,000, market confidence may recover, moving further towards $95,000-$96,000; if it continues to face resistance, it may fall into a longer period of consolidation or downward trend.

Investment Strategy Recommendations

• Short-term traders: It is recommended to pay attention to the breakout situation at $90,300; if it stabilizes, consider taking a small long position, with a stop-loss set around $88,000;
• Long-term investors: If Bitcoin falls below $83,000, consider gradually entering positions, but still need to pay attention to changes in market sentiment;
• Risk Control: The current market still has significant volatility, and it is recommended that investors control leverage ratios to avoid chasing highs and selling lows.

Conclusion: Bitcoin's Short-Term Recovery Still Holds Uncertainty, Cautious Response to Market Volatility

Overall, Bitcoin may have some rebound demand in the short term, but the bearish trend in the market has not been completely reversed. It is necessary to pay attention to trading volume, key resistance level breakouts, and large fund flows to determine whether the rebound has sustainability. In the current market context, investors should respond cautiously, avoid chasing highs, and closely monitor the breakout situation in the key resistance zone of $90,300-$93,000 to formulate appropriate investment strategies.

Disclaimer: The above content is for reference only and does not constitute investment advice.

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