The price of Bitcoin recovered over the weekend but fell to the levels from which the recovery was made on today’s low. Further downside would be expected for the price of Bitcoin as we are most likely seeing a correction of a higher degree.
- Increase of over 14% seen over the weekend but the price came back to the levels from which the increase is made.
- Price action is currently forming a cluster with a breakout to the downside looking more likely.
- If we are seeing a correction of a higher degree the price of Bitcoin is headed significantly lower but the first major support point would be at around $8500.
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Bitcoin Analysis BTC/USD
Over the weekend the price of Bitcoin has recovered by around 14.75% as it came up from Friday’s open at $10810 to $12405 at its highest point on Saturday.
After reaching the 0.618 Fibonacci level the price started another downturn like projected and made another attempt on Sunday but the price action made a lower high and the sellers took control.
From Sunday’s high at $12179.5 the price decreased by 12.52% measured to the lowest spiked today which was at $10654.4 but the hourly candle closed above $10810 which was the Friday’s opening price.
Currently, the price is being traded at around $11041 as it came up to the 0.236 Fib level and got rejected there. The price found support at the ascending channel made from 10th of June but a breakout to the downside would be expected as the third wave has shown impulsiveness.
On the hourly chart, you can see that the price action is currently forming a cluster between the 0.236 Fibonacci level and the ascending support zone as the seller’s are putting pressure but the buyers are still present at those levels.
We are most likely seeing the development of the third wave after the five-wave impulse to the upside ended which is why I would expect to see a breakout to the downside below the ascending support zone.
This third wave could be either the final one as the three-wave correction would develop or it could be a five-wave impulse of the lower degree which would be the first wave of the higher degree correctional structure.
I believe that the second is more likely considering that the price of Bitcoin experienced unsustainable growth with the wave structure implying that we have seen the completion of the higher degree 5th wave of the Minor count.
With this 5th wave’s completion, we could have seen the end of the Y wave of the Intermediate count in which case the price of Bitcoin is now headed for another bearish period with further lows ahead below $3200.
This could be possible if from 15th of December we’ve seen correctional upside movement, but considering the bullish momentum and the mania following the market with the price of Bitcoin increasing by over 322% I don’t believe that’s likely at this point, especially as the price of Bitcoin came to the 0.618 Fibonacci level from its all-time high.
In either way I would be now expecting further downfall for the price of Bitcoin to some of the broken resistance levels on the way up, out of which the first one would be at around $8500, but if we are seeing the development of the higher degree correction this area would only serve as a temporary support, with the price headed to $6250 area after as its the second significant resistance zone, broken on the way up.