Bitcoin’s $75K Test: Correction’s Finale or False Dawn

Market Overview: Bitcoin

In my previous report, I cast a cautious eye on Bitcoin’s near-term trajectory, diagnosing a bearish tint to the market’s pulse. I highlighted the magnetic pull of lower levels—specifically, the breakout point of 2024’s eight-month trading range, a structural anchor that loomed large beneath the price action. On the IBIT ETF chart, a conspicuous gap had formed during the 2024 bull breakout, propelling Bitcoin past the psychological $100,000 milestone. In hindsight, this was a textbook breakaway gap—a decisive rupture that fueled a measured move upward, doubling the height of that prior consolidation. I flagged this as a potential exhaustion point, a moment where profit-taking could cap the ascent.

Fast-forward to today, and Bitcoin sits nearly 30% below its all-time high, a precipitous retreat that has traders pondering the next chapter. Is this a terminal plunge, or a pause before renewal? My diagnosis: we’re witnessing the beginning of the end of this correction. The price has probed critical supports, found tentative footing, and now hints at a shift. Bear with me as I dissect the charts, to clarify why this downturn may soon yield to greener pastures.

A pivotal context underpins this analysis, one I’ll echo throughout 2025: the White House’s Bitcoin Reserve signature has legitimized Bitcoin as a treasury asset. This isn’t mere hype—it’s a seismic shift. Public and private institutions alike are now compelled to weave Bitcoin into their balance sheets, a structural tailwind that tempers downside risk. The upside potential isn’t infinite, but a double or triple from current levels is squarely within reason. This foundational demand reshapes the game, and it’s why I’m cautiously optimistic despite the recent bleed. Let’s dive into the weekly chart to unpack the evidence.

Bitcoin

The Weekly chart of Bitcoin

To grasp Bitcoin’s current posture, we must first rewind to 2024’s defining narrative. For eight months, the price oscillated within a tight trading range—a coiled spring of indecision between $50,000 and $65,000. Then came the breakout: a bullish eruption that shattered the upper boundary, igniting a measured move equal to the range’s height. By November 2024, Bitcoin kissed the long-awaited $100,000 mark—a milestone that felt both triumphant and precarious. At the time, I cautioned that this round number could magnetize profit-taking, a natural pause after such a climb. The upside, I noted, was likely capped as institutional hands began to lighten their loads.

What followed was a three-month sideways shuffle—a classic topping process. The price etched a Double Top around $100,000-$108,000, a formation that may signal a major pivot. Unlike a bull climax—a sharp, euphoric spike that collapses under its weight—this protracted consolidation suggested a more deliberate unwind. Institutions, as they often do, were selling into strength, meeting retail demand to offload at premium prices. Three months of lateral drift is a hallmark of significant tops; it’s the market’s way of digesting excess before choosing a direction. And choose it did: the Double Top’s neckline—the low between those peaks—snapped, ushering in the current descent.

The Correction: Testing the 2024 Breakout Point

This breakdown wasn’t a surprise; it was a textbook test of prior strength. Al Brooks, in his prescient 2021 outlook, underscored a Bitcoin truism: major breakout points get revisited in high probability, no matter how far the price stretches. He nailed it then—after 2021’s $60,000 peak, Bitcoin plummeted to retest the $20,000 breakout level from 2020, a move many deemed unthinkable. History rhymes, and 2024’s bull breakout left a similar imprint. That eight-month range’s upper edge—around $75,000—became a gravitational support, reinforced by the breakaway gap on the IBIT ETF chart. My prior report pegged this as a “strong magnet below,” a level the market would seek to probe.

And probe it has. Bitcoin’s recent slide didn’t hit $75,000 on the nose, but precision isn’t the point. In price action terms, this is close enough to call it a test. The market doesn’t ink perfect lines; it paints in broad strokes. This retest validates the 2024 breakout’s constructive nature—each surge higher builds robust scaffolding beneath. Does this mean $65,000 won’t be touched again? Not at all—it could still drift lower—but the test’s essence is complete. The price has honored its structural roots, and that’s a clue the correction may be nearing its twilight.

This Week’s Action: A Bull Reversal Emerges

Enter this week’s plot twist: a bull reversal bar on the weekly chart, sprouting from the ashes of that 2024 breakaway gap zone. This isn’t just noise; it’s a signal. That gap, formed during the ascent to $100,000, was a vacuum of unfilled orders—a hallmark of breakaway strength. When price revisits such zones, it often finds buyers lurking, eager to defend the prior launchpad. This reversal bar whispers resilience, a tentative pulse of bullish intent amid the wreckage.

Now, let’s contextualize the players. On weekly and monthly timeframes—my preferred lens for long-term trading—volume skews bullish. Big money doesn’t short Bitcoin here with conviction; bears are more likely bulls in disguise, hedging, rebalancing, or cashing out profits. The 30% drop from December’s $108,000 peak? It’s not a stampede of pessimism—it’s portfolio housekeeping. Institutions, facing quarter-end on March 31, will soon recalibrate. Bitcoin’s slide means their allocations are underweight; they’ll buy to refill, not sell to flee. The current support at $70,000-$85,000 feels like a staging ground—a level to “stack the coin” for those with a strategic eye.

Is This Bull Reversal a Buy Signal?

While the reversal bar is promising, it’s not a clarion call for bulls to charge. The bears lack ferocity—there’s no cascading panic—but the bulls aren’t flexing muscle either. A single bar doesn’t make a trend; it’s a spark, not a blaze. For conviction, I’d want price to flirt with the 26-week EMA and hold firm. If Bitcoin consolidates below this moving average for weeks, it’s a red flag—weakness festers in prolonged dips. Presently, the bar’s a foothold, not a launchpad. The Bulls need to prove they can reclaim ground, not just halt the bleed.

The Road Ahead: Correction’s Endgame

March may mark the beginning of the end of this correction. Over the next four weeks, I expect a bullish reaction. Why? The structural supports (breakout point, gap) may be held, institutional buying looms, and Bitcoin’s treasury status bolsters demand. The upside isn’t limitless—a double ($140,000) or triple ($210,000) from here is plausible. For investors stacking via dollar-cost averaging, with Bitcoin as a portfolio slice (say, 5-10%), these levels are a gift—accumulate and sit tight.

For traders, though, patience is king. Jumping in now risks catching a false dawn. I’d wait for a bull breakout—a decisive close above a breakout mode pattern or the $108,000 all-time high. That’s where momentum ignites, offering a high-probability ride with minimized risk. Trading is about timing, not hope—let the market confirm the turn before committing capital. A bear market could still lurk, and I’d rather watch from the sidelines than ride a sinking ship.

The Daily chart of Bitcoin

The Context: A Bear Channel Emerges

Zooming into the daily chart, Bitcoin’s recent narrative unfolds with stark clarity—a relentless downward drift since the collapse of a pivotal structure. That structure? A breakout mode pattern perched atop the trading range that formed the weekly chart’s Major Double Top ($90,000-$110,000). This wasn’t a gentle fade; it was a decisive breach. The pattern—consider it to be a tense standoff between bulls and bears—broke to the downside, shattering the equilibrium and unleashing selling pressure. Since that rupture, the price has sculpted a bear channel—a sloping corridor of lower highs and lower lows, punctuated by fleeting sideways pauses.

This isn’t a pristine, textbook bear trend, though. The channel’s edges are jagged, its descent more labored than ferocious. Bears have clawed downward, carving out breaks and gaps, but the result lacks the crisp authority of a tight bear channel—a sign of faltering conviction. Open bear gaps linger like unanswered questions, and strong downside breakouts—those meaty breakout bars or cavernous gaps—often fizzle into sideways-to-up meandering. It’s as if the bears roar, only to trip over their paws. This tepid momentum frames the daily action, and it’s a critical clue to where we stand.

Bear Strategies: A Trio of Attempts

Since the breakout mode pattern’s demise, I’ve flagged three bear strategies for traders exploring to exploit this decline. I suggested bears sell Friday’s close (around $86,000 on the spot chart) or below it over the weekend, anticipating a continuation lower. Monday delivered: a gap down opened the week, plunging price toward $75,000. Yet, the bears stumbled. Their two-fold target remained elusive, stalling near $77,000.

For a pro trader, this is a bitter pill. Textbook risk management screams for stops to breakeven here. The price grazed their target, teasing success, but lacked, for now, the strength to seal it.

Bulls: Waiting for a Pulse

If I don a bull’s hat, the daily chart offers little to cheer. Where are the muscular bull bars, those towering white candles with follow-through to signal buyers stepping in? Absent. The price languishes in this bear channel, occasionally twitching upward—sideways flutters after bear gaps—but these are mere reflexes, not reversals. A true bull signal demands vigor: a stout bull bar closing near its high, followed by a second bar pushing higher, preferably reclaiming the 21-day EMA. That’s the footprint of bulls wresting control.

The Trapped Bulls and Retest Risks

After a 30% plunge from $108,000, the daily chart reveals a lurking hazard: trapped bulls. Picture them—investors who bought the hype near $90,000-$100,000, now underwater, their positions bleeding red. A bounce higher will tempt these captives to sell, unloading bags at breakeven or slight losses. This overhang caps upside potential, adding selling pressure to any rally. Does it doom bulls to failure? Not necessarily—a surge to new highs ($108,000+) could overwhelm this resistance—but it’s a caution for reversal buyers now. Bounces will probably shake out weak bulls, making premature longs a dicey bet.

The savvy play? Wait. Let the market consolidate, forge a tight range, then buy the breakout above it. That framework offers a clear stop (below the pattern’s or breakout’s low). Buying here is too much risk, too little structure. Patience minimizes the odds of riding a bull trap into a bear abyss.

Downside Scenarios: Still in Play

Could Bitcoin sink further? Unequivocally, yes. The bear channel’s bottom, the wedge’s lower trendline—beckons, and a break below wouldn’t shock. Even the 2024 breakout point remains a plausible target, especially if bears muster one last growl. It’s a live scenario over the coming weeks. The daily chart’s lack of bull vigor keeps this door ajar—bears could still feast if momentum flips.

My Take: Watch and Wait

The daily chart paints a murky picture—a bear channel with fading teeth, no bull heroics, and trapped longs muddying the waters. My take? Stand aside. Bears lack the gusto to press lower with confidence, but bulls haven’t seized the reins. Watch for three signals: (1) a bearish violation—closing those open gaps; (2) bull stepping stones—strong bars with follow-through; or (3) sideways consolidation, setting up a breakout trade. Until the market speaks, it’s a waiting game. March may herald the correction’s end, as I noted weekly, but the daily chart demands patience.

You are welcome to discuss this report in the comments section below—I’d love to hear your takes. If you found this analysis valuable, share it with your network; let’s get the conversation rolling. Thanks for reading!

Josep Capo

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