In Scenario 1, as shown with a red arrow, Bitcoin capitulates completely without dancing in the descending triangle. While I think this is possible, especially since Bitcoin has closed below the $6500 level of support, I think it's less likely to happen than Scenario 2.
In Scenario 2, as shown in green, Bitcoin's price performs a double bottom (which has not happened yet as of this writing) and climbs back towards $8000 before breaking out of the descending triangle towards the downside. I think this is the most likely scenario to occur, especially if we see a double bottom formation in the $6500 range in the next few days. In both Scenario 1 and Scenario 2, the most likely stop after capitulation is $4000, with a range of $3500 to $5000, which is a strong area of support.
Scenario 3 (Blue), is the least likely to happen because the overall cryptocurrency market is still in a bear market. Overall, the bulls are currently not in control of this market.
The last scenario I want to address not shown on the chart is the possibility that Bitcoin simply "bounces" between $6500 and $9000. In this scenario, it's a continuation of Scenario 2 but instead of breaking below the descending triangle, the price simply bounces off the $6500 support line. This scenario is also unlikely because of the current trend is downwards (lower highs) and not sideways as some may believe.
As always, please take this analysis into consideration but don't treat it as financial advice. Leave a like and comment below if you have differing views (or you just want to comment for fun, that's cool too).
In Scenario 2, as shown in green, Bitcoin's price performs a double bottom (which has not happened yet as of this writing) and climbs back towards $8000 before breaking out of the descending triangle towards the downside. I think this is the most likely scenario to occur, especially if we see a double bottom formation in the $6500 range in the next few days. In both Scenario 1 and Scenario 2, the most likely stop after capitulation is $4000, with a range of $3500 to $5000, which is a strong area of support.
Scenario 3 (Blue), is the least likely to happen because the overall cryptocurrency market is still in a bear market. Overall, the bulls are currently not in control of this market.
The last scenario I want to address not shown on the chart is the possibility that Bitcoin simply "bounces" between $6500 and $9000. In this scenario, it's a continuation of Scenario 2 but instead of breaking below the descending triangle, the price simply bounces off the $6500 support line. This scenario is also unlikely because of the current trend is downwards (lower highs) and not sideways as some may believe.
As always, please take this analysis into consideration but don't treat it as financial advice. Leave a like and comment below if you have differing views (or you just want to comment for fun, that's cool too).