Friday, February 3, 2023

Bitcoin Price Heading for $3,500 — But It May Be For the Best

Bitcoin Price Heading for $3,500 — But It May Be For the Best

Don’t get too comfortable with the current bitcoin price. According to technical indicators, the cryptocurrency is set for a drop to $3,500 — and then it has to restart the climb towards $5,000.

Also read: Christine Lagarde: Cryptocurrency Regulation Is Inevitable

Bitcoin Price Technical Analysis

Long-Term Analysis

Bitcoin Price Technical Analysis

A new long-term cycle could begin when prices arrive at the $3,500 target, likely setting the lowest bottom parameter for the year. From there, an inverted ABC recovering pattern would be possible, allowing the markets to meet Elliot Wave Theory criterion again.

An inverted flag formation broke to the bearish side of the $9,000 Fibonacci support, performing a 3rd downward wave. The markets then built an inverted 4th relief to the upside, sending the bitcoin price back over $8,000. However, the 5th down wave seems to be heading into another plunge.

When the new price range between $20,000 and $3,500 is formally established, a 1st pull back level would be considered at $10,000.

Mid-Term Analysis

Bitcoin Price Technical Analysis

After a “Dead Cat Bounce,” which contributed the 4th wave according to Elliott´s Theory, a new trading resistance can be considered at $9,000. Mathematical indicators currently do not have enough strength to sustain the current price at $8,000, so the downtrend will likely resume and allow another drop to $3,500.

If the bitcoin price can recover from $3,500 to $5,000 through a climbing, ABC, zig-zag pattern, an ascending trend inside the bearish channel could be evaluated to face the $9,000 resistance.

Short-Term Analysis

Bitcoin Price Technical Analysis

A Diamond Formation could be in progress to contribute to end the fall. To build this formation, values need to follow several hypothetical steps, such as accomplishing the 5th downward Elliott Wave to $3,500 and fulfilling an ABC recovery pattern.

Japanese Candlestick Analysis doesn’t support a reversal rally from current levels, so the price could go down from this point to the target and start all over from there, within the combination of theories, criteria, and formations that define the trend.

What do you think will happen to the bitcoin price? Share your predictions in the comments section.

Image via Pixabay

This technical analysis is meant for informational purposes only. Bitsonline is not responsible for any gains or losses incurred while trading bitcoin.

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