Bitcoin price is trading in the mid-$40,000 range, unable to get through $50,000 but still holding strong the higher the recovery goes. The series of higher lows continues, potentially creating another base for the cryptocurrency to blast off from.
This base would mark the third out of four before the “selling point” according to how parabola works in financial markets. But this is all contingent on Bitcoin price holding a very crucial curved support line, extending from the asset’s bear market bottom. Take a look.
Will The Bitcoin Parabola Break Or Blast Off From Here?The king of cryptocurrency is stuck – between new highs and new lows, so the market is undecided and fearful despite the high prices. Several signs point to the peak at $65,000 being the top of the cycle, which would mean targets fell significantly short of the hundreds of thousands of dollars per coin which were expected before it was all said and done.
Related Reading | Bitcoin Golden Cross: Everything You Need To Know About The Bullish Signal
The hope is that what was witnessed in April around the time when Coinbase Global went live on the Nasdaq is instead a mid-cycle pullback before the rest of the rally resumes.
Will a base build or the curve bust through? | Source: BTCUSDT on TradingView.comDuring each bull market cycle, a series of higher lows keeps the cryptocurrency climbing until the trend ends. According to where the latest higher low as potentially formed, it could clarify a parabolic curve that could carry the asset to higher prices eventually.
Elliott Wave Supports Theory And $100K Target At Cycle TopIn a comparison with a parabolic curve “step-like formation” diagram, Bitcoin formed base one at the bottom. A much longer base two formed following the June 2019 peak that clearly in hindsight wasn’t the top.
The third base could be in process now, with the bottom being the bounce below $30,000. With higher lows forming the parabolic curve pictured above, the recent selloff during the day Bitcoin became legal tender in El Salvador, could have been one last test of the curve before the cryptocurrency’s bull run continues, or a more a deeper drop is to follow once the curve breaks.
Even on lower timeframes, Bitcoin is holding the curved support | Source: BTCUSDT on TradingView.comBitcoin is even retesting that curve on lower timeframes at this very moment, so there may be more clue as to direction soon enough. Down very well could be the direction. The macro environment is bearish, several altcoins are experiencing strong pullbacks after ridiculous rallies, and the dollar is gaining strength.
If parabolic support holds, however, a line drawn across past mid-cycle peaks could provide clues as to where the cycle eventually ends.
Elliott Wave is added to the parabola to support the target | Source: BTCUSDT on TradingView.comThrow in some Elliott Wave Theory and there is a potential roadmap that could follow. Major corrections tends to fall back to the previous cycle’s wave four. Drawn from that wave four across the top of what would ultimately be wave one and wave three in the current cycle, should pin-point about where wave five could stop.
Related Reading | Bitcoin Price “Pitchfork Channel” Could Pin-Point The Last Dip Ever
Wave three is usually the longest and easiest to spot of the bullish trend. Wave five should match the Fibonacci structure of wave one. That would take Bitcoin exactly to that line, which runs around $128,000 per BTC – but only if it also continues to follow the parabolic curve drawn above.
Breaking through now could create a wider, lengthened parabola at new lows, meaning base three failed. If it didn’t, it will cause the asset to at least double in price before the top is in, which means a lot closer to the six figures analysts have been predicting for years now.
Follow @TonySpilotroBTC on Twitter or via the TonyTradesBTC Telegram. Content is educational and should not be considered investment advice.
Featured image from iStockPhoto, Charts from TradingView.com
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