The Bitcoin Correction Nobody Wanted: Are We Still in a Bull Market?

Bitcoin Roadmap

Bitcoin has broken below several critical support levels that I’ve been monitoring closely, and we’re now sitting 17% off the all-time highs. With prices having dropped as low as 103,500, this pullback raises important questions about where we stand in Bitcoin’s 4-year cycle and what comes next.

Shifting From Bullish to Cautious

My previous outlook coming out of that September low through to the all-time high was extremely optimistic. I spoke extensively about how confident I was in that move continuing higher. But here’s the thing: market structure changes constantly, and it’s absolutely critical to adjust your bias when price action demands it.

I don’t want you holding onto the mindset that everything remains overwhelmingly positive. The bulls have lost the control they established when taking this market from late September up to the all-time high. That initial pullback was acceptable, especially since it coincided with the altcoin liquidation situation. A retest followed by continuation would have been perfectly normal.

What I really wanted to see was a swift recovery and resumption of the upward trend I had outlined. That hasn’t happened. Instead, Bitcoin’s trading way lower.

What’s Particularly Troubling

Given how late we are in this bull market, watching Bitcoin break through these support zones is troubling. We’re at a stage where the market should be showing strength, not weakness.

What makes this particularly concerning is the absence of any major negative catalysts. We’ve actually seen a stream of relatively positive news and supportive narratives that should have driven prices higher. They haven’t. When a market shows weakness despite good news, or at minimum neutral news, that’s a red flag I can’t ignore.

Looking at the weekly timeframe, we’re now back below the 10 moving average ($113,800). In a healthy rising trend, you want to stay above that level.

Where We Are in the 4-Year Cycle

Considering where we stand in the 4-year cycle, it becomes logical to question whether we’ve already seen the top for this phase. I know that’s not what anyone wants to hear, but we have to be realistic about the possibilities.

Looking at the monthly chart, a move below the 10-period moving average would be significant. That level sits around 100,000, which also aligns as a strong psychological level and the 50-period moving average on the weekly timeframe. So technically, I’d still say Bitcoin remains in a bull market as long as it can hold above this level.

But here’s the thing: I don’t want to just sit there holding while Bitcoin bleeds lower. That’s not an effective strategy, especially when the technical structure is deteriorating. Protecting capital and managing risk actively is far more important than hoping for a bounce that may or may not come.

How I’ve Positioned Myself

I’ve already taken action based on the recent price action. When altcoins broke their key levels, I sold most of my altcoin positions. After Bitcoin broke below $108,000, in line with that September low, I reduced my Bitcoin exposure as well.

The main reason for cutting altcoin exposure is simple: when Bitcoin falls hard, altcoins suffer even worse. I don’t want significant altcoin exposure in an environment where Bitcoin could drop another 8% from here. In an 8% Bitcoin decline, we’ll likely see those altcoins down 20% to 30%.

This isn’t an environment where you should focus on “do I have enough exposure in case this shoots higher.” It’s about protecting yourself and minimizing massive losses or a big drawdown if we continue lower.

The Path Forward

Even if we reverse from here and move up, altcoins might surge 20% to 30% quickly, but you’d still capture a solid 12% to 13% move in Bitcoin if you maintain some exposure. Then you get the confirmation you need: the uptrend is back, the bull market has resumed, and we can start building positions again for the next leg higher.

The cash I’m holding now gives me flexibility for short-term opportunities when I spot a reversal. For example, if Bitcoin can reclaim 107,500 with a strong bullish close, I’d consider taking a position back. If we continue lower, I’ll be watching for reversal setups at the next major support zone where I can enter with a defined risk.

I’ll also be ready to jump into some altcoins if they break above resistance, but with much tighter stop losses and take profit targets. This isn’t the environment for letting trades run wild.

This isn’t an easy market right now. I think everybody would agree with that. It’s about keeping our composure and waiting for clear signals. I’ve already made my moves to protect capital. Now it’s about patience and letting this situation play out.

Thanks for reading.

Timothy Assi

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Written by Timothy Assi, an Elite Popular Investor on eToro.

Not investment advice. eToro is a multi-asset investment platform. Your capital is at risk. For information and educational purposes only.

Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk.

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