Bitcoin price jumps, targets $51,000
- Bitcoin price action has been established between $36,250 and $42,650 in the last seven weeks.
- On four separate occasions since 2019, Bitcoin has consolidated more than ten weeks before a new definitive trend was established.
- BTC appears to be forming a triangle, which could take several more weeks to fully develop.
Bitcoin price usually undergoes long-term consolidation phases. Although trading range-bound price action can be rather tricky, the longer the stagnation period, the more bullish BTC gets.
Bitcoin price rebounds swiftly
According to Elliot Wave Theory, triangles can only manifest with three swings per letter. For traders looking to scalp the market, it is best to assume that the C wave of the triangle Bitcoin price is unfolding was printed at $32,933 on January 24.
An upswing into the $51,000 area is very likely to happen in the weeks to come and is necessary to validate the D wave of the triangle formation. The lower time-frames are already showing bullish signals that could validate the optimistic outlook.
Bitcoin Weekly Chart
It is essential to consider an alternate scenario when speculating on larger timeframe patterns. Bears can still maintain control over Bitcoin price, sending it as low as $33,000 for another 13% price decline.
Still, long-term investors should beware that a break below the C wave at $32,933 will NOT invalidate the idea of the triangle formation, as C waves are commonly known to form complex corrections.
Any touch of Wave A at $29,301 will invalidate the overall triangle thesis.
If the triangle thesis is invalidated, a steep correction will be the next plausible idea for Bitcoin price with further price drops of 30–40%, challenging support at $26,500 and $24,000.
Author
FXStreet Team
FXStreet
