Bitcoin price action over the next week will determine price action for the next month. We have several paths forward:
Key factors:
- Bitcoin equilibrium/pennant pattern that started after the collapse of Bitcoin at the start of 2018
- Price testing the weekly 50 EMA
- RSI becoming oversold on the daily with today's dip
Historically, oversold conditions on the RSI has been followed by consecutive weeks of bullish price action. Additionally, in recent times, the weekly 50 EMA has provided strong support on the 4 Feb and 4 April
The following scenarios are ordered from most likely to least likely in my opinion:
1. Price holds the $7000 level and the very large equilibrium/pennant pattern will continue to play out. This would most likely involve a price climb to the $7800/$8000 level as determined by the 0.5/0.618 fib retracement, followed by a higher low on the daily.
Price breaks below the $7000 and tests the $6500 level. At this point, there will be a further two potential scenarios:
2a) The $6500 level is broken resulting in some tough months ahead for Bitcoin and the cryptocurrency space.
2b) Support is found at the $6500 level and price returns to retest the $7000 - $7500 range
Key factors:
- Bitcoin equilibrium/pennant pattern that started after the collapse of Bitcoin at the start of 2018
- Price testing the weekly 50 EMA
- RSI becoming oversold on the daily with today's dip
Historically, oversold conditions on the RSI has been followed by consecutive weeks of bullish price action. Additionally, in recent times, the weekly 50 EMA has provided strong support on the 4 Feb and 4 April
The following scenarios are ordered from most likely to least likely in my opinion:
1. Price holds the $7000 level and the very large equilibrium/pennant pattern will continue to play out. This would most likely involve a price climb to the $7800/$8000 level as determined by the 0.5/0.618 fib retracement, followed by a higher low on the daily.
Price breaks below the $7000 and tests the $6500 level. At this point, there will be a further two potential scenarios:
2a) The $6500 level is broken resulting in some tough months ahead for Bitcoin and the cryptocurrency space.
2b) Support is found at the $6500 level and price returns to retest the $7000 - $7500 range