Bitcoin is the original and by far the largest cryptocurrency. Since its introduction in 2009 it has grown exponentially and spawned many competing cryptocurrencies. Opinion is mixed as to its true worth, but speculation and huge interest has created a volatile - and potentially very rewarding - trading environment.

Updated: 23/12/2019 0730GMT 0230EST

NEXT 48 HOURS

INDEX 48H

V= 3 C =4            Conditions:  large correction
F=1  I=2 T= 3 S= 4  Strategy:  look for longs

December Bottom

Bitcoin made a further low into 6425 and recovered quickly. While this was above our 5910 ideal target, the recovery and the similarity with the mid-December bottom made last year give us reason to beleive it could be the bottom of this correction. This should complete the large correction from the 2019 highs and set up a proportional large rally targeting 20k.

Only now making new lows and failing in the 5910 area would suggest a much larger correction is taking place and we would then look at the larger repeating patterns (see evidence) which suggests a return to the 2018 lows.

 

 

 

 

EVIDENCE

2018 Repeat (bearish)
10D E1

EVIDENCE

NDX comparison
10D E1

EVIDENCE

Gold 1980s comparison
10D E1

NEXT 10 DAYS

INDEX 10D

V=4 C = 3              Conditions: recovery
F=2  I=1 T=3  S=4   Strategy:  two way trading

Bitcoin has very likely bottomed at the 3135 low in a capitulation much like the early 2015 low and a longer-term pattern similar to gold in the 1980s. While it is unusual for an instrument to recover from a bubble and crash, it does and can happen. Gold and the Nasdaq are good examples, as is Bitcoin itself from earlier periods. All recovered from a crash to trade new highs. Certainly Bitcoin's trend sequence calls for a final wave 5 rally as long a 1169 holds and this should take it above 20k. This should be much slower than the 2017 advance and lead to momentum divergence. We will track the smaller moves on the 48H commentary.

 

 

EVIDENCE

NDX comparison
10D E1

NEXT 3 MONTHS

INDEX 3M

V=4 C =2               Conditions: SLOWER  UPTREND
F=2  I=2 T=4  S=5  Strategy: LONG

The eventual path depends on how cryptos develop - if Bitcoin becomes an alternate to gold and a store of value for a new generation, and can hold 1135 got new highs to form a trend sequence above 20k, then the outlook is very bullish. This will have huge implications in the longer term as we could then expect at least another multi-year, proportional rally to the first 5 wave sequence after a long period of consolidation.