Good evening all.
Today I wanted to look at Bitcoin and how may be impacted by other markets and based on Elliott wave patterns. Today, as you know, the US dollar has seen a pretty nice recovery as crude oil moved above $90 and US yields rallied. This caused a serious sell-off in stocks and even impacted cryptocurrencies, which had been holding up quite well over the last few weeks. But it now looks like even this sector is trying to top out.
In fact, when looking at Bitcoin, we can clearly see that the recovery from the June lows is in three waves. More importantly, notice the decrease in bullish momentum since the market rebounded from 61,800. Normally, this suggests that bulls are losing strength, and this typically occurs in wave C.
We can also see some overlapping price action within the current recovery, which again suggests that bulls are losing momentum up here. However, we may still see a retest of $67,000, or maybe even $68,000, which is a very important resistance area; C=A. This zone also represents the previous fourth wave of one lesser degree from June 15.
BTCUSD 4h Elliott Wave count
So if this area is retested, we should still be aware of another sell-off later on. Once the decline starts, it could eventually reach at least 61,000 because, when looking at liquidation levels, you can see a large number of liquidation orders around that area. These levels often act like a magnet.
GH
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