Bitcoin was on the path of correction as it reached a up-to-date all-time high of $108,135 on December 17. It is worth noting that this correction has caused the leading cryptocurrency to decline by approximately 10% at the time of writing, and even it dropped below $93,000 very quickly.

This noticeable decline caused Bitcoin to retest the Bollinger Bands, and technical analysis suggests a rebound from there to reach a price target around $178,000.

Bitcoin Tests the Monthly Upper Bollinger Band Again

Bitcoins latest price correction caught the attention of cryptocurrency analyst Tony Severino, who highlighted the critical retest of the monthly upper Bollinger Band. Sharing your observations on the social media platform X, Severino emphasized the importance of this technical indicator, which measures market volatility and potential reversal points.

According to him, this development mirrors a similar pattern observed in January 2024, which ultimately led to a significant enhance following a similar retest.

According to the daily candlestick chart shared by Tony Severino, the upper Bollinger Band is currently just above $96,000, which corresponds to the current price of Bitcoin. A retest of the Bollinger Bands suggests that Bitcoin may be entering a up-to-date phase of growth after recent corrections.

Historical echoes: growth of 86% in January 2024 is a blueprint

Severino’s analysis points to similarities between current price movement and Bitcoin’s behavior in early 2024. He noted that in January 2024, a similar retest of the monthly upper Bollinger Band preceded an 86% enhance in Bitcoin’s price.

At the time, Bitcoin was trading near $46,000, following a powerful price rally in slow 2023. However, there was a brief correction in January when Bitcoin fell to $40,000 to test the upper Bollinger Band. This test served as a launchpad not only for further growth, but also pushed Bitcoin to break its then record and exceed $70,000 in March for the first time in its history.

If Bitcoin were to repeat that 86% surge at this point, it could rise to around $178,000, which Severino noted coincides with the upper end of his target zone. In another analysisthe analyst predicted that Bitcoin could reach its market peak as early as January 20, 2025.

At the time of writing, Bitcoin is trading at $96,402, still hovering around the upper Bollinger Band. Interestingly, the leading cryptocurrency is currently down 2.11% and 5.4% in the last 24 hours and seven days, respectively.

This recall has led to implementation over $5.72 billion in Bitcoin gains, which increased short-term selling pressure. The impact of this correction is perceptible in Bitcoin’s Relative Strength Index (RSI), which has dropped sharply from 69 on December 17 to its current reading of 45.

However, there are reasons to believe that the selling pressure may be weakening. This is because the RSI level of 43 has been a significant support zone for Bitcoin since September. If this support holds, it could provide the basis for Bitcoin’s move towards $178,000.

Featured image from ABC News, chart from TradingView