Bitcoin has faced significant headwinds recently, experiencing a nearly 30% decline from its all-time high, instilling widespread fear and uncertainty across the market. With the Fear and Greed Index plummeting to its lowest level in the past year, the key question arises: are we approaching a pivotal inflection point, or is this the beginning of the end for the current bull cycle?
There are several compelling reasons to believe that the uptrend may persist from this juncture:
Market Structure & Elliott Wave Analysis
The prevailing market structure suggests a higher probability of a corrective phase rather than a definitive trend reversal. Historically, corrective movements tend to retrace back to their origin, implying a potential rotation toward previous highs. Furthermore, Elliott Wave theory identifies Fibonacci extension levels as key termination zones for corrections, with the most common being the 1.0x and 1.618x extensions. Notably, Bitcoin has precisely touched the 1.618 extension, reinforcing the possibility of a structural rebound.
CME Gap & Liquidity Injection
A critical CME gap has now been filled, which could catalyze fresh liquidity inflows from sidelined capital. This is further evidenced by the formation of a substantial buyer wick on the daily candle, suggesting renewed interest and accumulation at these levels.
Anchored VWAP & Market Strength
The anchored VWAP from the August range low—marking the inception of Bitcoin’s 100% upward move—appears to be in the process of reclamation. If successfully held, this could signal a significant resurgence in market strength, providing a solid foundation for further upside momentum.
Should Bitcoin manage to reclaim its all-time high heading into the summer months, it could pave the way for an extended bullish continuation. However, as always, only time will reveal the ultimate trajectory.
There are several compelling reasons to believe that the uptrend may persist from this juncture:
Market Structure & Elliott Wave Analysis
The prevailing market structure suggests a higher probability of a corrective phase rather than a definitive trend reversal. Historically, corrective movements tend to retrace back to their origin, implying a potential rotation toward previous highs. Furthermore, Elliott Wave theory identifies Fibonacci extension levels as key termination zones for corrections, with the most common being the 1.0x and 1.618x extensions. Notably, Bitcoin has precisely touched the 1.618 extension, reinforcing the possibility of a structural rebound.
CME Gap & Liquidity Injection
A critical CME gap has now been filled, which could catalyze fresh liquidity inflows from sidelined capital. This is further evidenced by the formation of a substantial buyer wick on the daily candle, suggesting renewed interest and accumulation at these levels.
Anchored VWAP & Market Strength
The anchored VWAP from the August range low—marking the inception of Bitcoin’s 100% upward move—appears to be in the process of reclamation. If successfully held, this could signal a significant resurgence in market strength, providing a solid foundation for further upside momentum.
Should Bitcoin manage to reclaim its all-time high heading into the summer months, it could pave the way for an extended bullish continuation. However, as always, only time will reveal the ultimate trajectory.
Note
Alternatively, the bearish scenario if we fail to reclaim the range
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.