Bitcoin gave us a bit of a head fake, dropping to $8,270 before quickly recovering to $8,800. This means all 3 scenarios I outlined yesterday are still in play.
Here's a quick recap:
Scenario 1 is the most bullish and has the WXY pattern I've been discussing these past few days already complete. If this count is correct, it's on wave 1 of 5 and may play out like this:
Scenario 2 is more bearish short term, but bullish overall. It'd still have us in the WXY pattern, with wave A complete and wave B currently underway. Wave C would naturally follow. Once the ABC correction completes, that would also complete the WXY pattern. We'd then expect an impulse wave up. This could play out like this:
The 3rd scenario is bearish, and has bitcoin in wave 4 of 5 waves down. If this count is valid, we'd expect wave 5 to target approximately $7,591. This could play out like this:
Looking at the 4 hour chart, we can see bullish divergence on both the RSI and MACD. That's a sign of a strengthening market.
The 1 hour RSI has a strong ascending support line. If this holds, I'd expect one of the first 2 scenarios. If it breaks, the 3rd scenario may get validated.
I realize not much has changed since yesterday. It's a waiting game at the moment. Let's keep an eye on the RSI and volume. These are usually the first indicators that signal a major price move is coming.
BIAS:
Short Term: Neutral
Longterm: Very Bullish
I hope this has been helpful. I’d be happy to answer any questions in the comment section below. Thanks for stopping by.
Disclaimer: I am NOT a financial advisor and this is NOT financial advice. Please always do your own research and invest responsibly.
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