In just over 1 hour, Bitcoin dropped about $400 after it peaked very close to $11,500. Is bearish correction setting in?
June 25, 2019 | AtoZ Markets - Bitcoin could just be at the verge of a bearish correction after a big run of bulls in the last two weeks. The flagship cryptocurrency hit very close to $11,500 to completely recovered 50% of the 2018 bearish run. Meanwhile, price is currently recovering to $11,250 after it almost hit $11,000 minutes ago. Bitcoin market capitalization is now at roughly $200 billion which is 60% of the entire market's $332.8 billion according to data on Coinmarketcap. It remains to be seen whether the bearish correction from $11,475 will continue deeper or the bulls will support a push further upside.
Bitcoin has gained over 260% since it bottomed in December 2018 at $3,100. Though it started June with a dip, it has recovered and gained over 40% in the last two weeks. Some believe the June massive rally is as a result of Facebook releasing the whitepaper of its much expected Libra coin. The Libra coin might have boosted interests in stablecoins. This, therefore, could have caused the huge growth in the volume of Tether which has might have contributed to the current BTC rally. Crypto traders seem to prefer Tether as it's more stable than the traditional cryptocurrencies. Currently, Tether has over 64% share in Bitcoin trades, far more than the US Dollar which stands as the 2nd with 18% share.
From a technical perspective, Bitcoin is probably overbought after it hit a critical level at $11,400. A bearish correction could follow first to $10,000 and probably lower. Experts believe the current July run is not backed by institutional and retail interests. Conversely, the next important level after $11,400 is the $13,400 level where BTC would have completed 61.8% retracement of the 2018 bearish trend.
Bitcoin price prediction: Elliott wave perspective
From the perspective of the Elliott wave theory, the rally from $3,100 is in the last stages before a bearish correction starts. In the last update, the chart below was used to show the bullish impulse wave (1) at the 5th wave.
There is a need for the 5th wave trendline to be broken downside to confirm the possible end of wave (1) at $11,475.
Price has not really dropped to confirm the bearish forecast. A break below the wave 5 trendline could be the start of wave (2) to $7,000 before the bullish trend continues.