close icon

Bitcoin Fulfills Yesterday’s Bearish Elliott Wave Setup

The price of Bitcoin plunged sharply on Wednesday and keeps falling early Thursday. BTCUSD reached an intraday high of $10 280, before crashing to as low as $9555 yesterday. Today, the bears are still in charge and managed to drag the price to $9320 so far. To sum it up, Bitcoin lost almost $1000 per coin in less than 24 hours. But why?

One explanation can be that a large amount of Bitcoin futures is set to expire this Friday. Another reason for the selloff touted by crypto experts is the low level of liquidity in the market, which makes it much easier for the so-called “whales” to move the needle.

Bitcoin Price Chart Offers a Third Explanation

We admit that both explanations make sense. The problem is they make sense only in hindsight. In order to profit from major market moves, traders need a method of analysis that puts them ahead of these moves. Unless they can turn back time, knowing why something happened after the fact is of little use to traders.

Elliott Wave analysis is our preferred way of dealing with that problem. Yesterday, for example, while BTCUSD was still near $10 150, there was a textbook Elliott Wave setup on the chart below. It was sent to our subscribers as part of our regular Wednesday updates.

Bearish Elliott Wave cycle was sending a warning to Bitcoin bulls

The chart revealed that the decline from $10 955 to $9755 was impulsive. It was labeled 1-2-3-4-5 and was followed by a w-x-y double zigzag correction to the upside. Taken together, the impulse and the correction formed a complete 5-3 wave cycle pointing south.

Hence, more weakness had to be expected as long as the price stayed below the end of wave “y” at $10 650. There was no way to know how soon the bears were going to finish the job nor how the media was going to explain their actions. All we knew was that the above-shown setup tilted the odds immensely in bearish favor. Then this happened:

Bitcoin crash fulfills the bearish Elliott Wave setup

$10 650 was never put to a test. Bitcoin started falling almost immediately and still hasn’t been able to find a reliable support as of this writing. And while following the news can make you better informed, it will hardly make you a better trader. Elliott Wave analysis, on the other hand, might help with that.

What will BTCUSD bring next week? That is the subject of discussion in our next premium analysis due out late Sunday!

Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

Litecoin Lost 50% in Two Months. Is the Pain Over?

Litecoin, the fifth largest cryptocurrency, lost more than half of its market value in the past two months. Between June 22nd and August 21st, LTCUSD fell from $146 to $70. Since crypto assets have no intrinsic value, investors often compare the current price to its higher level some time ago. This leads them to the…

Read More »

Ethereum Made a Decision the Bulls Won’t Like

A month and a half ago, Ethereum was hovering in the vicinity of $340 a coin. The bulls seemed unstoppable after lifting the price by over 320% in six months. Unfortunately, an invisible threat was brewing under the surface. Instead of simply extrapolating the recent uptrend into the future, we thought it appropriate to take…

Read More »

How Bitcoin Almost Collapsed Last Month

The price of Bitcoin returned above the $12 000 mark two days ago. As of this writing, the biggest cryptocurrency is still trading in the vicinity of $12k and the larger uptrend appears to be still in progress. Less than two weeks ago, things were not looking so rosy. BTCUSD was hovering around $9500 in…

Read More »

Ethereum Price to Face an Important Decision Soon

Bitcoin has been unstoppable in 2019 and the old “to the moon” chatter is getting louder and louder once again. Ethereum – the second biggest cryptocurrency – has been delivering generous returns since the start of the year, as well. ETHUSD, currently hovering around $343, is up 325% from its December 2018 low of $80.90.…

Read More »

Overbought TRON Can Tumble 30% Against Dollar

TRON became the 7th largest cryptocurrency by market cap following a 135% surge in the last month. It surpassed Litecoin and Stellar on its way up and is now within a striking distance of Tether in the sixth place. TRXUSD’s recent performance can easily convince investors it is time to join the bulls. The problem…

Read More »

Bitcoin Proves Traders Can Prepare without “Knowing”

The price of Bitcoin slightly breached the psychological level of $3500 yesterday and still has not been able to escape its gravity as of this writing. The current selloff brought back the memories of the time when BTCUSD fell to $3122 a month ago. And while in the markets everyone is an expert in retrospect,…

Read More »

Here is Why BTCUSD is Down 40% in Less than a Month

The price of Bitcoin is declining at an unprecedented speed. Less than a month ago, BTCUSD was hovering above $5500. Last week it fell to as low as $3210, prompting Peter Mallouk, chief investment officer at Creative Planning Inc., to call Bitcoin a “dead man walking”. However, the truth is it didn’t take a professional money manager…

Read More »

More analyses