Is Bitcoin Facing a Major Correction? Technical Breakdown Signals $60,000 Risk Zone

Bitcoin has experienced a notable pullback from its October highs, retreating from the $126,000 peak to trade around the $91,840 level currently. According to market strategist Mr. Wall Street, this correction may represent just the beginning of a more sustained downtrend, with the cryptocurrency potentially revisiting support levels not seen since the prior bear cycle.

Technical Structure Shows Early Bear Market Signals

The analyst points to several concerning technical formations that suggest the bull market momentum has shifted. A critical weekly close beneath the 50-week exponential moving average—currently situated near $100,000—has triggered what he describes as a classic trend reversal pattern. Adding to this bearish setup, monthly MACD indicators have crossed below their signal lines, while the relative strength index displays divergence between price action and momentum readings.

These signals carry significant weight for long-term positioning, as they typically precede extended consolidation or decline phases in Bitcoin’s price discovery process. Beyond charting patterns, funding market stress and elevated reliance on US repo facilities suggest tightening financial conditions are permeating across risk assets, not just cryptocurrencies.

Macroeconomic Headwinds Create the Perfect Storm

The broader economic backdrop compounds technical vulnerability. Mr. Wall Street argues that deteriorating employment figures and moderating inflation readings pointed toward an urgent need for monetary accommodation beginning in early 2025. Yet policymakers maintained restrictive stances, citing inflation concerns that he contends have been artificially elevated by tariff-related pressures and external geopolitical factors.

This policy delay has left the real economy exposed to cascading stress. Since monetary easing operates through lagged transmission mechanisms, rate cuts alone may prove insufficient to prevent deeper asset repricing. The analyst suggests only a large-scale liquidity intervention—potentially worth trillions in new money creation—could meaningfully reverse current market psychology. Without such aggressive action, he expects continued pressure on risk assets through the coming quarters.

Additional catalysts for downside include potential interest rate increases in Japan, which would accelerate yen carry trade unwinding, potentially forcing liquidations across leveraged positions globally.

Where Could Bitcoin Bottom? Mr. Wall Street’s 2026 Forecast

Despite maintaining a multi-year bullish thesis on Bitcoin as a finite-supply asset benefiting from monetary expansion eventually, Mr. Wall Street sees near-term pain ahead. His base case involves an initial retest of the $100,000 zone (aligning with the 50-week EMA), followed by accelerating declines toward $68,000-$74,000 through mid-2026.

More concerning for holders, he places his primary target in the $54,000-$60,000 corridor by the fourth quarter of 2026, representing a roughly 40% decline from current levels. He has established short positions in the $98,000-$104,000 band to capitalize on this expected reversal.

The analyst explicitly rejects claims that quantitative easing has already commenced, characterizing recent Federal Reserve bond purchases as tactical operations rather than structural policy shifts. Until true liquidity expansion becomes apparent, he views rally attempts toward $100,000 as selling opportunities rather than breakout signals.

Market sentiment remains divided, though the technical deterioration and macroeconomic backdrop have shifted positioning among sophisticated traders toward defensive postures ahead of the anticipated correction phase.