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We Still Haven't Seen "the" Bitcoin Rally Yet (Weekly Forecast)

By Biz Wisdom | Crypto Daily FX | 5 Apr 2021


Bitcoin rallied a bit during the week ending April 4th, rising from around $55K up to the $60K level before finding resistance, closing the week candle just under $58K. This is a bullish continuation following the previous week's sharp drop and recovery to form a hammer, which Bitcoin has now closed a higher high and higher low as it retests local resistance and the current ATH.

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(April 4, 2021  8:30PM EST)

Short-Term: 

Bitcoin continued its recovery and has regained its position within striking distance of the $60K resistance and ATH level. When you zoom out on the Bitcoin weekly chart (shown above), you can more clearly see how early we are in the current bull market cycle. Having only had one real parabola from $10K - $42K, Bitcoin appears only just now about to start its second. Judging by my current Elliott Wave Count and the market psychology of bull markets, we should soon see the beginning of the notorious 'W3 of iii' should will lead to intense price discovery and appreciation, likely up to and into the six-figures. 

 

Given Bitcoin's recent correction, higher low, and strong recovery, we should see continued bullishness and attempts to breach $60K in the next week or so, which is not a significant resistance level so we should see Bitcoin break higher by April the latest. Once Bitcoin breaks $60K, and it's really just a matter of time (days), we should see a run-up to $70K, $80K, and over the medium-term, $100K. But to keep things in perspective, $10K moves are likely to be the norm going forward. 

 

After all, Bitcoin historically experiences seasonal weakness in Feb-March. If seasonality is any indication of what’s to come for Bitcoin, we should see Bitcoin gear up over the next few weeks for a precipitous rally to new highs in April-May but starting as early as late March. "The herd" of institutional investors is entering the space in rapid succession as we now regularly see weekly headlines from the likes of Morgan Stanley, Citi, etc. announcing 9+ figure interest in the space. 

 

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Returns by month — outliers excluded. Source: CoinMetrics, daily bitcoin price data for 18/07/2010 to 31/01/2020.

5d392e29a69788278c4402a898b400b3233dfbfc0e259fb1284a954631aa0a09.png

BTC Seasonal Performance Pattern Since July 2010 (Source: Tradingview)

 

 

Long-Term: 

The confluence of my EWT Wave 3 projection and Bitcoin monthly seasonality points to a rally that could send Bitcoin to about $95K by summer 2021 and a possible cycle peak as early as Q4 2021 somewhere in the range of $125K, or possibly much, much higher.

My crude Elliott Wave count for Bitcoin on the weekly chart shows a possible $94,000 Wave 3 target for Bitcoin later in 2021. By that measure, based on the price action lately as shown above, we are well within the projection and en route to this projection, which should take some time to play out but may only accelerate as Bitcoin's market cap grows, thus enabling conservative institutions on the sidelines enough justification finally enter Bitcoin long positions. This also coincides with multiple other models, such as Plan B's Bitcoin Stock-to-Flow Model which plots a minimum $100K target that extends up to nearly $300K, as well as the logarithmic regression which projects a $115,000 - $140,000 Bitcoin price within the next year.

Weekly Newsflow:

  • Coinbase announces April 14 IPO
  • Morgan Stanley & Goldman Sachs offering crypto exposure to high net-worth individual clients via physical Bitcoin, funds, futures, derivatives
  • Visa accepts crypto

The bigger Bitcoin gets the more legitimacy it gains = more institutional investors can justify taking initial positions, which would only add to the disproportionate demand vs supply. 

Support: 

Immediate support around $55K.

Then $52K.

Floor at $50K.

Resistance:

Immediate resistance at $60K, then $70K, $80K, then $100K. 

 

Buy Bitcoin here.

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Biz Wisdom
Biz Wisdom

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