Bitcoin continues to slide lower. How deeper could the bearish correction go? The following share insights based on Elliott wave theory.
July 17, 2019 | AtoZ Markets - The cryptocurrency market continues to plummet as the much expected bearish correction takes control. Bitcoin which peaked at $13,900 in June dropped to $9,100 before recovering slightly to $9,450. In the last 24 hours (at the time of writing this report), Bitcoin has lost nearly 12% of its value. Almost all the digital coins and tokens listed on Coinmarkepcap also saw red in the same time frame. With $169 billion in market capitalization, Bitcoin still holds 66% of the entire market capitalization which is currently just above $255 billion. Since late June when the market peaked, it has lost over $120 billion as buyers booked profits and new investors stay on the sideline.
After the big moves between December 2018 and June 2019, bearish corrections were expected across the board. The market still looks healthy and could still run above the all-time highs recorded in 2017 and early January 2018. Meanwhile, the current bearish correction needs to end before the cryptos resume 2019 bullish trends seen across the board in the first half of the year. How deep could Bitcoin go before? The following technical analysis is based on the Elliott wave theory.
EURUSD Elliott wave analysis
The current dip is the wave (2) after wave (1) ended at $13,900 in late June. In the last updates, we were able to forecast how the dip could go. A double zigzag corrective pattern was expected to end wave (2). In the chart below, used in the last update, the price was expected to break below the $9,600 support level to make a fresh July low.
The first bearish target was forecast at $9000-8,500 price zone. The next target is the $7,200 price level where wave 4 of (1) ended. Price is now very close to the first target as the new chart below shows.
Price is very close to the first reversal zone ($9000-8500) where we would expect wave (2) to end. If a fast break below does not happen and the price bounces with a strong reversal pattern, wave (3) could start and push above the $19,800 all-time high.