Just like we expected during our previous analysis, bitcoin price dropped throughout last week to record a low of $2045 earlier today, before rising again to $2345 at the time of writing of this article. This downwards price movement is most probably fueled by price correction attempts, as the market’s speculators are closing their long positions to collect their profits. So, where will price be heading during the upcoming week? Will bitcoin price continue dropping? or, will it continue on rising again as the downwards price correction attempts lose momentum?
Kindly, refer to our previous weekly bitcoin price analysis to get acquainted with our Fibonacci retracements and Gann angle placements.
Completing a 5 Wave Elliott Formation On the 4 Hour BTCUSD Charts:
Let’s examine the 4 hour BTCUSD chart from Bitfinex, while keeping our Fibonacci retracements and Gann angle placements and executing the Bollinger bands’ indicator (look at the below chart). We can conclude the following:
- Bitcoin price recorded a high of around $3000 last week, before dropping down all the way to record a week low of $2045. As we can notice on the below chart, price dropped a bit after overshooting above the $2691 price level which corresponds to the 0% Fibonacci retracement, so it seems that this level is representing a strong resistance level that prevented further advancement to higher price levels.
- The downwards price correction wave was reversed shortly after testing the 23.6% Fibonacci retracement level which corresponds to $2262.62, which denotes that this level is supporting price quite well as shown by the long downwards shadow of the candlestick highlighted by an ellipse on the below chart.
- Since the 13th of May, bitcoin price has been following a pattern characterized by bullish bursts followed by downwards price correction waves. As shown on the below chart, a 5 wave Elliott formation can be observed; 4 waves have already been plotted and the 5th bullish wave is just beginning to form. The 5th wave is expected to take bitcoin price to a level higher than the high recorded on the 11th of June ($3000) during the upcoming week or so.
- After testing the 23.6% Fib retracement level, candlesticks started touching the lower Bollinger band, which reflects relative market instability at this price level. Bitcoin price will mostly rise so that candlesticks would move away from the lower Bollinger band taking the market to more stable levels.
Conclusion:
After recording a high of around $3000 on Bitfinex, bitcoin price dropped during the past week scoring a low of $2045 earlier today. Our technical analysis predicts slowing down of the price correction attempt as the market’s bulls start pushing price to higher levels. We expect to see bitcoin head towards $3000 during the upcoming week.
Chart from Bitfinex, hosted on Tradingview.com