close icon

BTCUSD Ready for Another Terrifying Pullback?

It has been a little over a month since BTCUSD fell to $1830 on July 16th. Just as panic was starting to settle in, the bulls returned with fury. A few days ago, the biggest cryptocurrency hit a new all-time high of $4480. The hard fork is behind us already, Bitcoin Cash is doing pretty good as well and July’s scary dip is nothing but a distant memory now. However, Bitcoin is notorious for its volatility, which could wipe out entire accounts in a nanosecond. Should we expect another sharp pullback, similar to the previous one? Let’s ask the Elliott Wave Principle.

btcusd elliott wave analysis august 25
The 4-hour chart of BTCUSD allows us to see the wave structure of the rally from $1830. According to the big picture outlook, this phenomenal surge fits into the position of wave (5) of III of (V). Since wave (5) travels in the direction of the larger trend, it is supposed to form a five-wave impulse. As visible, it could already be seen as one, with the exception that wave 5 has not yet made a new high above wave 3. Wave 1 climbed to $2938, then wave 2 dragged the price down to $2400 and wave 3 added another $2080. At one point on August 22nd, BTCUSD was down by $880 in wave 4, which leads us to the present, where the final wave 5 of (5) of III is in progress.

If this count is correct, wave 5 should lift the price a new all-time high above $4500 very soon. However, instead of buying the bullish breakout, we believe traders should proceed with great caution, because according to the theory, every impulse is followed by a three-wave correction in the opposite direction. In that case, the anticipated decline should be labeled as wave IV of (V) and has the potential to erase roughly $1500 of Bitcoin’s price and revisit the support zone near $3000 per coin. Be careful.

Stay informed with our newsletter

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

Privacy policy
You may also like:

Ethereum ‘s Collapse Carries an Elliott Wave Message

Ethereum, still the second largest cryptocurrency with a market cap of ~$39B, was enjoying a strong 2020. ETHUSD was up 282% YTD until the start of September. The last few days, however, seem to have brought the bulls’ winning streak to its end. The price of Ethereum collapsed from as high as $489 to less…

Read More »

Bitcoin Is Up 35% Since Christmas. Here is Why

The price of Bitcoin was hovering around $7200 on Christmas, down from $13 880 six months earlier. And while the majority of headlines were all doom and gloom, the cryptocurrency‘s price charts were telling a very different story. Bitcoin was down 48% from its recent top, but that wasn’t the time to join the bears.…

Read More »

Bitcoin ‘s 40% Surge didn’t Come Out of Nowhere

On Thursday, we showed you how Elliott Wave analysis set the stage for a Bitcoin plunge to under $7700 ten days before Mark Zuckerberg’s Libra testimony. The cryptocurrency was barely holding above $7400 at the time of writing and many thought it was prone to decline even further. Since Bitcoin is among our premium instruments,…

Read More »

BTCUSD: Libra Testimony Didn’t Cause the Fall

Facebook’s Mark Zuckerberg testified before Congress on October 23rd about the company’s Libra cryptocurrency project. The hearing didn’t go as smooth as the crypto community hoped, which reflected on the price of digital assets such as Bitcoin. At one point on Wednesday, BTCUSD was down by over $750 for the day. But was Zuckerberg’s Libra…

Read More »

The Bears Rule Over Ethereum Under $225

We last wrote about Ethereum on August 9th. The second largest cryptocurrency had plunged by 42% in less than two months and was hovering around $210. Unfortunately, our Elliott Wave analysis of the decline from $363 pointed to more weakness ahead. See the chart below to refresh your memory. This chart was included in our…

Read More »

Staying Two Weeks Ahead of Bitcoin ‘s Crash to $8000

The price of Bitcoin has been slowly losing ground since late-June when it touched $13 880. The bulls have been relying on the support near $9000 for over two months. They no longer have that luxury. BTCUSD was still gravitating around $10 000 on September 23rd. The next day, it plunged to $7998. While the…

Read More »

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…

Read More »

More analyses