Bitcoin (BTC) experienced a significant drop below the crucial $110,000 mark on Tuesday following a massive sell-off by a whale who offloaded 24,000 BTC, equivalent to approximately $2.7 billion. This sudden market move led to a sharp reaction, wiping out $205 billion from the overall crypto market capitalization and triggering over $930 million in liquidations across leveraged positions.
As a result of this downturn, Bitcoin plummeted to its lowest levels in nearly two months, with intraday lows reaching around $109,000. Analysts are now warning that this correction may extend further, as technical patterns suggest a potential continuation of the Elliott Wave C move towards $105,000.
According to market analysts, Bitcoin’s rejection at $117,000 over the weekend set the stage for this decline. Based on Elliott Wave Theory, Wave C often mirrors Wave A in length, making the $105,000 zone a prime target for the current correction. This area also aligns with Bitcoin’s Point of Control since April and the anchored VWAP support line, further supporting the bearish scenario.
However, there is a strong counter-argument suggesting that the $107,000–$108,000 range, which represents the 61.8% Fibonacci retracement of the June-to-August rally, holds significant buying interest. Data from Bookmap indicates clustered orders at this level, indicating a potential reversal point if buyers enter the market aggressively.
Despite the prevailing bearish sentiment, analysts emphasize that a daily close above $110,000 for Bitcoin could potentially shift the market sentiment. Such a move would suggest a liquidity grab rather than a full-fledged continuation of Wave C. A more robust confirmation would be if Bitcoin manages to reclaim $112,000, signaling that the recent downside break was corrective rather than impulsive.
Traders are advised to closely monitor the $108,000 support level, as a breakdown could escalate selling pressure towards $105,000, while a decisive bounce could restore short-term momentum. It is essential to keep an eye on how the market reacts in the coming days to determine the next potential direction for Bitcoin’s price.
In conclusion, Bitcoin’s recent sharp sell-off highlights the delicate balance between whale activity, technical structures, and macroeconomic uncertainties. While downside risks remain elevated in the near term, a recovery above $110,000 and especially $112,000 could invalidate the bearish Wave C scenario, indicating a more corrective pullback rather than the beginning of a larger decline.
Cover image from ChatGPT, BTCUSD from Tradingview.