The price of Bitcoin reached its extension limits yesterday and has likely ended its bullish momentum from 26th of April which is why a sharp downturn has occurred.
This downturn was expected and now that it has started we could be seeing the start of the higher degree movement to the downside.
- Bitcoin has decreased by over 15% from yesterday’s high indicating strong bear presence.
- As the ending wave likely completed we are seeing the higher degree downtrend developing with the price of Bitcoin potentially going to $6250 for a retest of the broken resistance area.
- If we are seeing the higher degree downtrend the price is now headed to some of the significant support levels but as the bullish structure developed fully and the momentum behind today’s selloff is strong it could end as a correctional upswing before further lows.
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Bitcoin Analysis BTC/USD
Bitcoin reached $8302.4 at its highest point yesterday but started decreasing from there at first slowly but then with strong momentum as the price fell to $7005.8 at its lowest spiked today which was a decrease of 15.62%.
The price is currently being traded at $7269 as a small recovery has been made.
Looking at the 15-min chart, we can see that the price broke out from the ascending channel on the downside and has come down to its first significant support level around the 0.236 Fibonacci level where it is establishing support.
The ascending channel was viewed as a continuation pattern with another final push to the $8515 significant horizontal resistance level expected to play out but it now looks like the 5th wave of every count has ended which is why a sharp downturn has been made.
This sharp downturn was expected after the completion of the 5th wave and now that the ending wave has developed fully it likely started. The five-wave move seen from 26th of April is considered the 5th wave from the higher degree count which also ended with the mentioned wave as it is the sub-wave of the impulsive move.
This is why now I would be expecting to see the price of Bitcoin going significantly lower than the current levels as the price is in a lookout for support.
The Fibonacci level currently offers support but strong seller’s momentum has been seen in the last 24 hours which could indicate that the higher degree downturn has in fact started.
The price of Bitcoin could now go back to $6250 significant resistance area for a retest of support but since the area hasn’t offered much resistance on the way up it is still unclear whether or not the level will serve as support which opens the possibility of further lows.