BTC/USD - Long Awaited Bottom Might be Close

BITFINEX:BTCUSD   Bitcoin / U.S. Dollar
In this post, I have made a longer-term analyses of the BTC in order to try to identify the potential bottoming scenario. In my opinion, we are in the final stages of the correction that has atrted over 15 months ago when BTC /USD pair had picked just under the 20k price mark.

There was hope that the recent corrective move up will lead to a broader market correction, but unfortunately, the bulls power is fading and it can be clearly seen that the big whales are waiting for another push down to accumulate their longer-term long positions. I, personally see 2 potential scenarios of the price action from the current levels.

The less likely one, but still realistic, is that we will see a further move up (yellow curve) and will touch the 200 day EMA . In this case, we might see a potential double top on the RSI indicator + extremely overbought reading. I expect the price to bounce from that red EMA and make an impulsive drop down (we have seen similar price action in the past - green circles). Looking back to 2017, I have identified 2 major support levels which are 3000 and 1800 (chart on the left). In my optimistic scenario, the 3k level should hold. If so, there might potentially be a bullish divergence which indicates that the long -waited bottom is in play.

The second scenario, which I see as the most likely one is that we will see a drop from the current levels (red curve). As you can see, the long-term uptrend line on the RSI had been broken yesterday. I was watching it closely the last couple of weeks, and in my opinion, it is a very bad sign. The uptrend line on the price chart had been broken as well. And now, if that 50 day EMA (green line) will not hold in the upcoming days, we might see an impulsive leg down towards a lower low which is the first major resistance. In both scenarios, if the Major Resistance Level 1 holds, there is a high probability that we will see a bullish divergence and probably another bottoming pattern on the smaller timeframes.

I don't exclude that the 3k support level might not hold. In this case (which I consider as the worst case scenario) we will see a free-fall towards 1800. But lets hope that the bulls will defend the 3k region. If I am right, April - May should be the last month of the correction after which a new cycle will be started. The next cycle is expected to be less aggressive as the previous ones, but still BTC price above 50k is expected in the next 18 months.

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Check out my earlier analyses posted in September. Link in the comment section!

Comment: Check the analyses above on a more detailed explanation of the importance of the 3k support level.


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