1. Reasons for Plummet: Technical Correction and Excessive Leverage

Bitcoin plummeted after reaching a historical high of approximately $123,226 on July 14 (0.768 Fibonacci Extension), with three core reasons:

1. Technical Overbought: 4-hour RSI has soared to 78+, severe short-term overbought triggering profit-taking sell-offs;

2. Leverage Risk: Futures funding rate has risen to 0.0119% (though not reaching the dangerous threshold of 0.05%), but the surge in long leverage has led to an increase in liquidation vulnerability, with $468 million liquidated in 24 hours;

3. Cycle Resistance: Price has reached the first level resistance band of the weekly logarithmic growth curve (123K-125K), an area that has previously triggered mid-term corrections multiple times.

2. September Rate Cut: High Probability Supports Long-Term Bull Market

The expectation for a Federal Reserve rate cut in September is clear, as shown by the CME FedWatch Tool:

- 64% probability of a 25 basis point rate cut, 36% probability of a 50 basis point rate cut.

History shows that defensive rate cuts (not driven by recession) usually push risk assets up, with an average increase of 20% in US stocks. Liquidity easing may guide funds into the crypto market. If economic data remains robust, Bitcoin will benefit from macro liquidity injections.

3. Bottoming Position: Triple Support Structure

The current key support areas for the correction are as follows:

- Short-term (Healthy Correction): $114,000-$117,000 (Breakout Retest + 4-hour Fair Value Gap), if maintained, will sustain the upward structure;

- Medium-Strong Support: $113,000-$110,000 (Anchored VWAP + Value Area High VAH), breaking below will weaken bullish logic;

- Deep Defense Line: $107,000 (High Volume Node HVAC), where 420,000 BTC buy orders are gathered, providing psychological and structural dual support.

4. Conclusion: The Bull Market is not Over, Gaining Momentum Towards 135K

The market is not over but needs to digest selling pressure: On-chain indicators show long-term holders are reluctant to sell (aSOPR=1.03 not overheated), accumulation addresses have reached 250,000 BTC (a new high for the year), and OBV is rising in sync, confirming new capital inflow. If the $114K support holds, a push towards the 135K-140K Fibonacci target is expected after the correction, driven by September rate cut expectations. Investors can gradually position in ETH upgrades, RWA tracks (like AAVE), and resilient public chains.