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By the end of the year, Bitcoin price was trading close to long-term technical levels, raising questions about the potential for a deeper correction if Bitcoin breaks out of current support levels.
Despite a slight recovery at the start of the week, prices remain close to an area historically associated with the onset of sharp declines in previous sessions.
As of press time, Bitcoin is trading at approximately $87,200, with daily trading volume of nearly $35 billion.
The currency fell 1% in 24 hours and was down about 4% on a weekly basis.
The currency hit a bottom near $80,500 on November 21 and has been trading in a range of $84,000 to $90,000 for more than a month since then.
Technically, Bitcoin price is currently testing the 100-week simple moving average (100-week SMA), a level seen as a key indicator as Bitcoin began to see a major correction over the past decade.
“Chain Mind” analysts said that previous breakthroughs in this average have resulted in declines between 35% and 55%. The most prominent example is in 2022, when Bitcoin fell by more than 57% after closing below the same level.
Historical records show that this average was formed ground However, during bear markets, breaking above it often increases pressure.
The data shows that the current decline actually reflects a decline of about 31% from the previous peak of around $126,000.
A confirmation of a close below the 100-week moving average would likely repeat the previous situation and open the way for a drop to the $35,000 to $50,000 range.
At the same time, the slope of the average is flattening, which may indicate that long-term momentum is slowing.
Traders await the weekly close to see if the price will hold this support or continue to fall.
On the shorter time frame, Bitcoin price is trying to reclaim the 20-day moving average after spending 78 consecutive days below the 20-day moving average, a level considered important to confirm any trend reversal.
Michael van de Poppe noted that returns above this average could change the short-term outlook, but warned that previous breakouts were uncertain and used to correct waves.
Notably, the price of Bitcoin opened 2025 at $93,400 and is currently down approximately 5% since the beginning of the year.
With three days left until the annual candle closes, Lark Davis points out that historically Bitcoin has not closed in the red in the year following the halving, making the year-end close a lot of focus.
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