Bitcoin currently experiencing the long overdue correction I was waiting for. To be honest I was expecting this correction around $23,500 region and the rally for last three weeks was not something I was expecting (You know, when FOMO comes in, technical analysis is not making much sense LOL). Also RSI was in overbought region for long time and it was warning us that a correction should happen soon. In my daily chart I have outlined 2 different scenarios based on moving averages as resistances for coming days for Bitcoin, so let's get it to:
1- 21 daily moving average is currently at $32,000 which acting as a strong support level. I anticipate a bounce back at this level given that the price is falling for last 5 days. Then price will climbing up again to retest $40,000 levels and potentially continues the bull market.
2- After a short bounce back at 21 daily moving average, the price will continue to go down to retest the 50 daily moving average which currently is at $25,000. This resistance level of 50MA should act as a very strong support and we should see that the price hold it very well.
So now, I will give the second scenario a higher chance (60%), given that all indicators were signaling warnings for quite a long time and historically after a strong rally traders/investors will secure their profits and wait for another opportunity to open their long positions. However first scenario is not off the table either, there is still a possiblity that the correction is over and as we have seen back in November, bulls will start buying back and push the price up again, in this case a retest of $40,000 is plausible.
However, keep in mind that we are just at the beginning of this massive bull market (As I predicted in my idea back in September), so if you are a die hard holder of Bitcoin just live your life worry free. In a separate idea I will talk about my price targets by the end of the year for Bitcoin.
If you are a trader, keep an eye on Altcoins, specifically ETH and LTC while Bitcoin completes its correction!!!
Cheers!
1- 21 daily moving average is currently at $32,000 which acting as a strong support level. I anticipate a bounce back at this level given that the price is falling for last 5 days. Then price will climbing up again to retest $40,000 levels and potentially continues the bull market.
2- After a short bounce back at 21 daily moving average, the price will continue to go down to retest the 50 daily moving average which currently is at $25,000. This resistance level of 50MA should act as a very strong support and we should see that the price hold it very well.
So now, I will give the second scenario a higher chance (60%), given that all indicators were signaling warnings for quite a long time and historically after a strong rally traders/investors will secure their profits and wait for another opportunity to open their long positions. However first scenario is not off the table either, there is still a possiblity that the correction is over and as we have seen back in November, bulls will start buying back and push the price up again, in this case a retest of $40,000 is plausible.
However, keep in mind that we are just at the beginning of this massive bull market (As I predicted in my idea back in September), so if you are a die hard holder of Bitcoin just live your life worry free. In a separate idea I will talk about my price targets by the end of the year for Bitcoin.
If you are a trader, keep an eye on Altcoins, specifically ETH and LTC while Bitcoin completes its correction!!!
Cheers!
