Bitcoin is facing fresh correction risk after a sharp sell-off pushed BTC from above $79,000 toward $77,000. The move triggered roughly $547 million in crypto liquidations before buyers stepped back in. BTC was trading around $77,291, down 0.43%, at the time of writing.
The pullback came after Bitcoin reached about $79,500, its highest level in months. The rejection has raised concerns that the recent rally could face another correction, particularly as leverage remains elevated.
Bitcoin Faces Fresh $77K Support Test
Bitcoin’s move above $79,000 was short-lived as sellers quickly pushed the price lower. The decline toward $77,000 triggered a wave of liquidations across leveraged positions.
The recovery, however, shows that demand has not disappeared. U.S. spot Bitcoin ETFs recorded $307.45 million in net inflows on Aug. 21, extending their inflow streak to five consecutive days.
The continued ETF demand provides support for BTC, but the failed breakout above $79,000 leaves the market vulnerable to another pullback
How Low Can BTC Price Go?
Analyst P4 Provider has identified $79,000 as an important resistance level after Bitcoin swept liquidity above that area. The analyst also pointed to bearish RSI divergence, rising USDT dominance and elevated funding rates as signs of increasing correction risk.
The analyst’s downside levels range from $77,000 to $71,000, with $70,000 identified as a deeper target if selling pressure increases. P4 Provider also advised traders to protect profits, use tight stop-losses and wait for clearer buying opportunities.
On-chain analyst Maartunn attributed the sharp drop to heavy positioning among traders betting on higher prices. Once Bitcoin moved into the liquidation zone, forced selling accelerated the decline.
Maartunn said liquidity is now building above $78,300, while additional liquidity clusters extend lower toward $68,000.
This leaves leverage as one of the main risks for Bitcoin’s next move.
What Could Drive BTC Next Week?
PCE and GDP Could Set the Tone
The next major test comes on Aug. 26, when the U.S. Bureau of Economic Analysis will release the second estimate of Q2 GDP and July Personal Income and Outlays at 8:30 a.m. ET. The release will also include the latest PCE inflation data.
A softer inflation reading could strengthen expectations for easier monetary policy, while a hotter-than-expected reading could pressure risk assets, including Bitcoin.
The second estimate of Q2 GDP will also provide an updated view of U.S. economic growth. The advance estimate showed the economy growing at a 1.5% annualized rate in Q2.
Nvidia Earnings Add Another Market Catalyst
Nvidia is scheduled to report its second-quarter results on Aug. 26 after the U.S. market close.
The company’s results and guidance could influence broader technology stocks and risk appetite. A strong report could support the current market rally, while weaker-than-expected results could add pressure to equities and spill over into crypto.
Jackson Hole Could Drive the Next Major Move
The Jackson Hole Economic Policy Symposium will take place from Aug. 27 to Aug. 29. This year’s theme is “Financial Innovation: Implications for Payments and Policy.”
The key event for markets will be Fed Chair Kevin Warsh’s keynote speech on Aug. 28. Investors will look for clues about the Federal Reserve’s policy outlook ahead of the September FOMC meeting. A dovish message could support Bitcoin and other risk assets, while a hawkish signal could increase pressure on markets.
For Bitcoin, the immediate levels remain important. Holding the $77,000 area could keep the recovery intact, while another rejection near $79,000 could expose BTC to deeper support levels identified by analysts.
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