Bitcoin’s meteoric rise to $111,900 may be setting the stage for a significant correction, according to detailed Elliott Wave analysis. Recent predictions of Bitcoin reaching $120K could be challenged as technical indicators suggest a potential reversal.
Elliott Wave Pattern Completion Signals Market Top
Crypto analyst firm Sniper Academy has identified the completion of a critical five-wave Elliott Wave pattern on Bitcoin’s monthly chart. This technical formation, widely respected in traditional and crypto markets, suggests that BTC’s bullish momentum may be exhausting after reaching the $111,900 mark.
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Key Price Levels to Watch
The analysis highlights three critical support levels that could determine Bitcoin’s trajectory:
- Initial support at $66,000 (potential 50% retracement)
- Secondary support at $53,000
- Major bottom target at $31,000 (0.618 Fibonacci retracement)
Technical Indicators Confirm Bearish Outlook
Several technical factors support the bearish thesis:
- Formation of a double top pattern between $76,000 and $111,000
- Divergence patterns emerging on multiple timeframes
- Resistance at the upper boundary of a long-term ascending channel
Accumulation Opportunity Ahead
While the short-term outlook appears bearish, analysts suggest that a drop to $31,000 could present a significant accumulation opportunity. This level could serve as the launching pad for Bitcoin’s next major bull cycle.
FAQ
What is the Elliott Wave Theory?
Elliott Wave Theory is a technical analysis method that suggests market prices move in repeating wave patterns driven by investor psychology. A complete cycle consists of five waves in the primary trend followed by three corrective waves.
How reliable are Elliott Wave predictions?
While Elliott Wave analysis can provide valuable insights, it should be used in conjunction with other technical and fundamental indicators for more accurate predictions.
What could prevent Bitcoin from falling to $31,000?
Strong institutional buying, positive regulatory developments, or significant market-moving news could potentially prevent or minimize the predicted decline.
