Sometime this month, Bitcoin made its way back above $8000. It was believed by some or perhaps many, that the glory days would return if the digital currency could cross over $10000. In fact some well-known Crypto analysts and enthusiasts predicted $50,000 strong rally at the end of this year. Unfortunately, that might not happen. In fact, prices could go deeper if the following technical forecast plays out. Is there any hope that the glory days will resume soon?
The bearish move has dominated this year with little bullish bounces in-between. Last two weeks, price touched the $6500-5800 zone again. It had earlier bounced off the zone on 6th February (when the first bearish phase ended), 29th June and 14th August. The rallies that followed these bounces are decreasing thereby confining price within a range. The 6th February bounce ended at $11500, 29th June bounce ended at $9500 and 14th August bounce ended at $8500. This gradual and timely price action is completing a familiar sideways pattern – triangle pattern. The chart below illustrates more.
The chart above shows a triangle pattern completing the last leg – based on Elliott wave theory ( triangles have 5 legs). The last leg – wave E, which is the current rally, might not last above $7500. Price might eventually break below $5600-$5800 support zone. If this happens, prices will drop further to $4000 (78.6% Fib-retracement of the all-time rally) and even $2000 (88.6% Fib-retracement of the all-time rally). Unless price rallies fast above $8600, the bear are set to continue. The chart below shows the short-term forecast.
To compliment the larger degree forecast, the current rally looks corrective and might run out of gas at $7000-$750o price zone. Once the w)-x)-y) channel line is broken downside, price will much likely break below the support zone on its way to $4000. Unless a fast break above $8600 happens, the bears are still in control.
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