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Bitcoin Friday: Technical Analysis of Bitcoin

Bitcoin is currently at a key level. It is not yet clear what will its next movement be, but in this article, we will discuss scenarios that may occur.

Technical analysis is basically just probability and statistics. Sometimes there are situations where there is a huge probability that the charts will go in a certain direction, other times there are multiple options at once. And today it is the latter of the two.

New all-time high

The first option is quite simple – Bitcoin will go to a new maximum which would indicate that correction is over. This option is proving increasingly likely because we have already witnessed a double top. The chart and the price have not yet been rejected, even though we can already see signs of weakness on the indicators, however, the price level has not yet fallen.

First possible Bitcoin price development scenario is new all-time high Figure 1: First possible scenario of Bitcoin price development

Triangle

The second option is that the correction is not over yet and we will be witnessing a side trend for some time, but without falling to a new low. In this case, the market most often goes into a correction in the form of a triangle. Since the growth has been so significant up to this point, it would probably be an ascending triangle, from which the price would then dart to a new maximum.

Second possible price development on Bitcoin could lead to a triangle formation Figure 2: Second possible price development on Bitcoin could lead to a triangle formation

ABC correction

The most bearish option that comes into consideration is the ABC correction. In this case, the price would already be moving around the top with decline waiting for us around the corner. With the ABC correction, a new low or at least a double bottom could easily occur.

Third possible alternative to Bitcoin price development is ABC correction Figure 3: Third possible alternative to Bitcoin price development is ABC correction

Conclusion

There are currently several options regarding the Bitcoin price development. In this situation, one of three scenarios may occur. Unfortunately, we do not currently know which one. Personally, I think that the longer the price consolidates around the top, the more likely it will eventually break to a new high.

Jakub is a crypto trader and founder of Trader 2.0 project, which helps hundreds of traders from central Europe to understand cryptocurrency trading and its challenges. Jakub not o...

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