It looks like the bitcoin price could cancel the $3,500 bearish target in light of recent sideways activity. Thus, the markets could anticipate a reversal bounce by a thousand points before breaking resistance to the upside.
Bitcoin met the conditions to break all support levels in a fall towards the bottom of the dominating bearish channel. The panic phase is on, pointing to theoretical target near $3,500, but quotes could see a strong reaction any price below $5,000 and break the descending resistances to the up side –at a lower level like $6,000.
Such a move could start a theoretical reversal zig-zag movement, which would kick-start the way to $14,000 according to Fibonacci retracement numbers. Gann Angle Theory reflects that values are re-entering the Fall angle´s stage and, depending on news and fundamental data, if it accelerates enough, the increasing volatility would work as a bounce booster.
Mathematical indicators have anticipated fall and recovery movement at least twice in the near past, and these days similar signals can be watched in the charts.
Quotes confirmed the downward movement towards bearish objectives below $5,000, supported by all development theories and considering an average criterion. This would contribute to end the current cycle and would free prices to climb back to historical highs and beyond.
Focusing on development theories, which were also successful in anticipating the trend, it can be said that if values follow the indicators going down and bounce, a big rise will probably start.
Japanese Candlestick Analysis reflects a downward movement that will lead to an overall rise in prices. Following this ancestral criterion, we could conclude that there are too many crows relative to soldiers, leading the soldiers to retreat and regroup at a lower level.
Complementing with western indicators and Elliott Wave Theory, although the precise calculation results at $3,500, once values break $5,000, all prices will be low enough to allow a rebound.
According to mass psychology, after the panic breaks down, the next successive stages will be disbelief between $4,000 and $6,000, hope from $6,000 to $7,500, and optimism from there to the trigger at $9,500.
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This technical analysis is meant for informational purposes only. Bitsonline is not responsible for any gains or losses incurred while trading bitcoin.