Sirwin
Sirwin

Bitcoin Hinting at $40K Before Rally? (3/5/21 Forecast)

By Biz Wisdom | Crypto Daily FX | 4 Mar 2021


Bitcoin fell on Thursday, initially rallying just above the $52K level before giving back much of yesterday's gains, closing the daily candle around $48K. This is a bearish candle and raises the question of whether or not Bitcoin is ready to move higher just yet or perhaps is going to put in a definitive bottom before moving higher. 

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(March 4, 2021  7:30PM EST)

Short-Term:

Bitcoin didn't close lower than yesterday's low so that's a good sign for our rounded bottoming "U" shaped recovery pattern, which is still in play. If Bitcoin can grind sideways to slightly higher, then we very well may already have our bottom and Bitcoin could go straight back to $60K (not straight but you know what I mean).

However, if today's weakness is an indicator that perhaps Bitcoin is not ready to resume higher just yet, then Bitcoin may need to retest the bottom around the 50% fib at ~$44K or is going to put in a firm and decisive bottom at a lower low around ~$40K, like in January when Bitcoin dropped to $29K on a second drop. You could make a case that Bitcoin has put in A and B Waves in a corrective EWT pattern down, which points to a lower C wave yet to come that would take Bitcoin down to $40K before ultimately bouncing. Time will tell but because things move faster in crypto, we may a resolution as early as this week.

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Long(er)-Term: 

After Bitcoin decisively puts in this W2 bottom (or perhaps ABC corrective pattern down), Bitcoin should grind back higher as it begins a larger W3 higher (potential W3 of W3). A conservative measured move of 1.612% of the micro W1 that just terminated around $58K measures up to the 2.272% Fibonacci extension level around $99K. A more aggressive move measuring 2.612% of the recent W1 would send Bitcoin up closer to $125K (literally off my chart above). Bitcoin will likely not only hit our projected price targets but exceed them due to higher than anticipated inflation and government Quantitative Easing on a huge scale, especially starting H2 2021. I think $100K is not only on the table but a high likelihood in late 2021. Even the Stock to Flow Model for Bitcoin is well on track, pointing to a $100K - $200K Bitcoin, and the S2FX model points to a nearly $300K BTC end of this cycle. 

Support: 

1st support: $45K.

2nd support: 50% fib around $43,800.

Floor: $40K. 

Resistance: 

Immediate-term = roughly $60K.

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Biz Wisdom
Biz Wisdom

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