$BTC

Bitcoin correction means that the price returns to lower levels after a large upward movement to form new lows before resuming the upward trend. Corrections are a natural part of the markets and occur to take profits or reassess the overall situation.

Reasons for correction:

1. Overbought: The price may have reached overbought levels on indicators such as the RSI.

2. Profit taking: Traders take profits after a strong upward wave.

3. Negative news or uncertainty: such as tightening regulations or technical issues.

4. Natural market movement: Corrections help the uptrend continue in a healthy way.

Retracement analysis:

1. Correction target levels:

Use Fibonacci to identify potential support levels (such as 38.2%, 50%, or 61.8% of the previous move).

Watch key support levels on the 4-hour time frame.

2. Technical signals:

Watch trend lines: If the price stays above the uptrend line, it indicates a continuation of the uptrend after the correction.

Check the volume: A decrease in volume during a correction means that it is just a correction and not a trend reversal.

3. Possible actions:

For the day trader: Wait for bounce signals (reversal candles such as a hammer or bullish engulfing).

For the long-term investor: A correction may be a buying opportunity if the technical and news basis is strong.

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