Bitcoin has been staging a recovery in recent sessions, but from an Elliott Wave perspective the structure still appears corrective rather than impulsive. While the short-term momentum has improved, the broader technical picture suggests the rally may still be part of a larger corrective phase within the overall market structure. Traders should therefore remain cautious as price approaches a major resistance zone between $74,000 and $80,000, which could determine the next significant move.
On the daily timeframe, Bitcoin’s rebound continues to resemble an ABC corrective rally rather than the start of a new impulsive bullish cycle.
Within Elliott Wave theory, this structure could represent either:
- Wave B of a larger correction, or
- Wave 4 within a broader bearish sequence
Both scenarios imply that the current recovery may only be temporary before another downside move unfolds.
The key characteristics supporting the corrective interpretation include:
- Overlapping price action, typical for corrective waves
- Lack of strong impulsive acceleration
- Recovery occurring after a clear decline rather than from a long consolidation base
As long as the rally remains below the $80K region, the probability remains higher that the market is still forming a corrective recovery within a larger bearish cycle.
Zooming into the 4-hour timeframe, the structure becomes clearer. The market appears to be progressing through wave C of the ABC correction.
Wave C is often the final leg of a corrective move and can sometimes develop into ending diagonal or wedge patterns, especially when momentum starts to weaken as the move progresses.
Currently, price action suggests the potential development of a rising wedge pattern, which typically signals:
- Weakening bullish momentum
- Higher probability of a bearish reversal once the pattern completes
If the wedge structure completes near resistance, it could act as a trigger point for the next downside move.
However, a strong breakout above the $80,000 area would invalidate the near-term bearish outlook and suggest that Bitcoin is in a larger, higher-degree wave B corrective recovery.
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