Bitcoin (BTCUSD) is having a red week so far (1W time-frame) following last week's rebound. The worse than expected CPI is leading this pull-back fundamentally. Technically though, the price remains both above the Support provided by the 1W MA300 (red trend-line) and the Channel Down that started after the mid-August High. As long as no further Low is made, this Channel can be technically considered a Bull Flag, and is consistent with both prior Cycle bottom sequences.
** Past Cycles bottom formation ** As you see on this chart, the pattern that emerged after each prior Cycle bottom, was this Bull Flag. The price basically started to break above the Flag when a 1W MA50/ 1W MA100 Bearish Cross (1W MA50 in the blue trend-line crossing below the 1W MA100 in the green trend-line). Once the 1W MA50 break, the price never looked back and the parabolic rally of the new Bull Cycle took off.
The 1D MA200 (black trend-line) is the first level of Resistance on the medium-term and is currently around 29800. The importance of this is high because on those past Cycles, every time the 1D MA200 crossed below the 1W MA100 to form a Bearish Cross, the Cycle's Bottom was priced.
** The Fibonacci levels as Targets ** Back to the 1W MA50, once it broke, the price reached the 0.5 Fibonacci retracement level, which was just above the 1W MA100, very quickly in fact in a matter of 3 weeks. The next Target on the medium-term (and Resistance) for both prior Cycles, was the 0.786 Fibonacci. In 2016 it was hit in 32 weeks after the 0.5 while in 2019 in just 6 (but that was a rapid growth based on, among others, the Libra fundamentals).
** What's next? ** All the above suggest that if the same cyclical pattern continues to play out, Bitcoin should complete the Bull Flag now and start rising as the 1W MA50/100 Bearish Cross has been formed. A realistic technically target towards the end of the year would be the 0.5 Fib at $33900, where by that time it can make contact with the 1W MA50 potentially. We can then expect a 0.786 Fib test at just above $49000 by Q2 2023. All this calculated as the average projection of the past 2 Cycles.
Do you agree that this Bull Flag, following the MA50/100 Cross is about to start a rally to test the August High and then $33900 before the year is over? Feel free to share your work and let me know in the comments section below!
This looks promising. I smell some disbelief in comments.
TradingShot
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@FrankPlankton, For a decade BTC's long-term Cyclical behavior never failed to deliver.
wargolynch
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@FrankPlankton, The only disbelief you smell is produced by your own hippocampus. Google ===> "Binance futures data" ===> Oh wow more bull than bear accounts! You can't smell data.
FX_Professor
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You are one for the few authors i like to check charts from. Keep it UP @TradingShot
TradingShot
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@FX_Professor, Likewise Professor! Keep up enriching the community with your highly detailed analysis!