Yilihua, founder of Liquid Capital, recently shared his technical assessment of Bitcoin's current price action. He believes the ongoing decline is the third wave from the October 11 high, and according to wave theory and cyclical patterns, this could be the last sharp correction before the market bottoms.
Decline Structure and Key Price Levels
Yilihua traced Bitcoin's trajectory from its all-time high of $126,000 and identified the current phase as the third wave downside. He calculated two extreme scenarios: a 60% drop from the peak would bring Bitcoin to approximately $51,000, while a 66% crash would target around $43,000. Both scenarios align with typical retracement depths seen during the final stages of a bear market.
Key Factors Influencing the Outlook
Yilihua pointed out that the primary macro drivers of this decline include US equity market trends and the performance of major institutions like Strategy. Moreover, the Federal Reserve's response to upcoming CPI data is critical: if the data surprises and alters interest rate expectations, it could trigger further US stock selloffs and indirectly pressure Bitcoin. He also warned that each previous bear market concluded with a black swan or credit event, and no such signal has emerged yet, requiring continued vigilance.
Bottom Determination and Investment Window
Although the exact bottom remains uncertain, Yilihua emphasized that July to August is likely the final bottom zone of this cycle. In his view, based on wave cycles and historical precedents, this time window will present the most compelling buying opportunity in the next three years. For long-term investors, patience is key until the market confirms a bottom structure before deploying capital.