Bitcoin spiked above the $11,100 pivot point on Monday. Has the bearish correction completed? The following technical analysis is based on the Elliott wave theory.
August 08, 2019 | AtoZ Markets – Bitcoin rose back to life after the bearish correction that saw it slumped to $9,100 from $13,900. The correction lasted for over a month. However, the surge from $9,100 is getting bigger with the break above $11,100 showing the first sign of the end of the bears. Price is now at a crossroad between ”bullish continuation” and ”bearish continuation”. The price patterns emerging firmly support that the 2019 bullish trend will resume with further upside breakaway toward the $19,800 all-time high.
While Bitcoin gained nearly 28% in just over 2 weeks, the aggregate of the Altcoins lagged behind especially in the last couple of days. This has enabled BTC to increase its market share from 64% to 67.5% with $206.6 billion in market capitalization. The entire market capitalization has also crossed the $300 billion mark after adding $19 billion in the last 24 hours and $40 billion in the last one week. In late June, the entire market capitalization rose to $385 billion from about $133 billion recorded at the turn of the year.
Bitcoin analysis: important price levels
Prior to the current surge, we discussed the $11,100, $13,100 and $13,900 resistance levels which are the nearest targets for short term bullish speculation. Price has now breached above $11,100. If the bullish momentum increases, the other levels will be hit. On the other hand, a fast dip below the $10,000 psychological level might bring BTC toward $8,500 and $7,200.
Bitcoin price prediction: Elliott wave analysis
Our BTCUSD Elliott wave forecast supports price advancing toward the $19,800 high. The bearish correction completed with a double zigzag pattern at $9,100. In the last update, we identified the possibility of a double bottom reversal pattern with a neckline at $11,100. The chart below was used.
Price has now broken above the neckline as the chart below shows. A bullish impulse wave is expected to cause a breach of the $13,100 and $13,900 highs.
Price is very close to breaking above the wave (2) channel which is the second confirmation of the bullish trend continuation and our preferred wave count. However, wave (2) looks shallow (less than 50% retracement). Wave (2) of an impulse wave usually corrects 50-61.8%. Bitcoin, however, has a history of shallow corrections, especially in a fast trend. Taking this into consideration, the possibility of a much deeper bearish correction to $7,200 exists, especially if the price is resisted at $12,000.