The cryptocurrency market fell sharply due to the hawkish expectations of the Federal Reserve, with the lowest price today at $95,700. However, many technical analysts remain optimistic about the future trend of Bitcoin. The Bollinger Bands and Fibonacci extension indicators suggest that the upward trend is not over yet, and it is predicted that it will exceed $166,000 in February 2025.
Since the US Federal Reserve (Fed) released its hawkish policy, the cryptocurrency market has plunged rapidly, with Bitcoin plummeting from $104,800 on the 19th to today's lowest point of $95,700, a cumulative decline of 8.7%. In the past 24 hours, the total amount of liquidation of contracts on the entire network reached $1.003 billion, and more than 300,000 people were liquidated, suffering heavy losses.
However, before this wave of decline, Bitcoin had previously set a historical high of $108,300 on the 17th. Many technical analysts remain optimistic about Bitcoin's future price trends, believing this is a healthy correction with potential for further increases.
Bollinger Bands suggest a continuation of the upward trend.
John Bollinger, the creator of the well-known technical indicator 'Bollinger Bands,' tweeted early on the 19th that Bitcoin's recent performance perfectly showcases the classic application of Bollinger Bands.
After experiencing a squeeze phase, the price begins to steadily rise along the upper track of the Bollinger Band.
This statement suggests that Bitcoin's trend is very strong and may continue to rise.
In technical analysis, prices typically choose a direction to break out after a Bollinger Band squeeze, and the current trend indicates that Bitcoin's price is steadily rising along the upper line of the Bollinger Band, which is characteristic of a bullish market with a high probability of further increases.
Fibonacci extensions predict a breakthrough of $160,000 in February next year.
Technical analyst CryptoCon, who has over 110,000 followers on X, also shared his views based on Fibonacci indicators on the 19th. He pointed out that Bitcoin recently approached the historical high of $109,000, which aligns with the Fibonacci extension targets, showcasing the accuracy of this indicator.
Looking ahead, CryptoCon believes Bitcoin is expected to break through $160,000 in February 2025. He stated:
What's next? Will there be a significant correction?
As the bull market fully kicks off, corrections are no longer the main focus. Of course, this does not mean corrections won't happen; it just means their impact has become less significant. The opportunity to buy cryptocurrencies at this stage has passed.
What is the next milestone and timeframe?
I set my next target at the Fibonacci 5.618 extension level, which is about $166,000. I estimate the timeframe to be February 2025, based on the current accelerated trend and trajectory.
This is not mysticism; it is simply a target based on accurate Fibonacci extensions and important time frames.
Additionally, I believe the peak in February will not be the endpoint of this round of market movement.
The fear index suggests a bottom.
Additionally, the Chicago Board Options Exchange (CBOE) Volatility Index (VIX), known as the 'fear index,' has also released signals that Bitcoin's price may reach a local bottom. On Thursday, the VIX soared 74%, marking the largest single-day increase since February 5, 2018, and becoming the second-largest growth record in the index's history.
Historical data shows that a sharp spike in the VIX often signals a local bottom for Bitcoin. For example:
February 5, 2018: On that day, the VIX surged 116%, and Bitcoin plummeted 16% to $6,891. However, just 15 days later (February 20), the price of Bitcoin rebounded to over $11,000.
August 5, 2024: During the yen arbitrage trading closure, the VIX rose 65%. At that time, Bitcoin's price dropped 6%, hitting a local low of around $54,000, and rebounded above $64,000 on August 23.
Macro factors must still be considered.
However, experts remind that these theories do not adequately consider overall economic factors. The current market is affected by US and Japanese monetary policies, presenting a high degree of uncertainty. In the case of a delay in the expectation of US interest rate cuts and Japanese yen rate hikes in 2025, the yen arbitrage gap may be delayed like an unexploded bomb, which could lead investors to be unwilling to allocate funds to high-risk assets in the short term, especially among more cautious Wall Street investors.
Will the trend suggested by technical analysis indicators be validated again? Let's wait and see.
