Recent market movements have Elon coin newscrypto traders scrutinizing Bitcoin's price action after its 11% decline from December's peak of $108,374. In a detailed technical breakdown, market strategist Rekt Capital mapped potential scenarios based on historical precedents from previous bull cycles.
Historical Cycle Analysis Reveals Critical Timeframe
The analyst's research highlights weeks 6 through 8 of price discovery phases as historically volatile periods. Examination of 2013, 2017 and 2021 cycles shows consistent patterns where BTC faced substantial retracements during these windows, with some exceeding 30% declines. "These specific weeks frequently test investor psychology," Rekt Capital noted, referencing the 75% plunge during week 7 of 2013's cycle.
Current price action finds BTC testing the $96,537 weekly support level - a zone that previously catalyzed the rally to six-figure valuations. The analyst warned that losing this foothold could accelerate declines toward the $89,000 region, which aligns with Fibonacci retracement levels from the recent uptrend.
Technical Indicators Flash Caution Signals
Market technicians are monitoring several concerning developments on higher timeframes. A bearish engulfing candle formation on weekly charts suggests potential trend exhaustion, while the breakdown of former resistance-turned-support levels indicates weakening momentum. "The 5-week moving average currently acts as critical trend confirmation," Rekt Capital emphasized, noting its importance as a bull market sustainment indicator.
Additional downside targets include the $78,000-$80,000 CME futures gap, a common phenomenon in Bitcoin's price history where exchange-specific liquidity voids eventually get filled. Historical data shows approximately 85% of such gaps close within 90 days, presenting a plausible downside target should current support levels fail.
Long-Term Bullish Thesis Remains Intact
Despite short-term concerns, the analyst maintains conviction in Bitcoin's macro trajectory. "Healthy corrections create the foundation for sustainable advances," Rekt Capital explained, drawing parallels to 2021's 16% mid-cycle pullback that preceded new highs. The current 10% retracement remains within normal parameters for Bitcoin bull markets, with historical volatility suggesting such moves represent standard market behavior rather than trend reversal.
Market participants should note that Bitcoin has never breached its 20-week moving average during bull market consolidations, currently positioned near $85,000. This level may serve as ultimate support should selling pressure intensify in coming weeks.
As of latest data, Bitcoin trades around $95,000 with market depth charts showing substantial liquidity clusters between $92,000-$94,000 that may provide interim stabilization. The coming weeks' price action around identified support zones will likely determine whether this correction evolves into a deeper retracement or establishes a base for renewed upward momentum.
