Bitcoin’s next rally is here: The Elliott Wave continues to point towards $164,000

In our previous update, and as shown in Figure 1 below, we found for Bitcoin (BTCUSD) by using the Elliott Wave Principle (EW) that,

“… the next rally may be imminent, because second waves tend to retrace between 50-76% of the prior 1^st wave [W] rally, which in this case targets $112,564-$109,807. Bitcoin has now reached that zone. Thus, the orange W-2 has become protracted (yesterday’s bounce, today’s 2nd leg lower), but a break above the orange W-1 high ($117,981) will be a serious warning for the bears, with confirmation of gray W-iii above the gray W-i high ($123,220).”

Fast forward, and BTC bottomed out at $108,664 on September 24 for the orange W-2, which is only 1.1% below the ideal target zone we’d provided, and made a new All-time high ($126,287) yesterday, proving our EW-based analyses, like our previous one, correct.

Figure 1. Bitcoin’s short-term Elliott Wave count with several technical indicators, moving averages, target zones, and warning levels for the Bulls

The rally from the September 26 low has subdivided into three (blue) waves so far, with September 30^th as W-ii, yesterday’s high as W-iii, and now the blue W-iv is underway. The ideal target zone of $121,554-123,146 is shown, but Bitcoin can drop to approximately $117,933 without violating this EW count. As such, the warning levels from last have been raised accordingly.*

Lastly, in our August update, we reaffirmed that our ideal upside target for Bitcoin, based on larger waves, time cycles, and other factors, is $164,000. Examining the ideal green W-5 target zone (176.4-200.0%) in Figure 1, we find that it corresponds to a range of $164,796 to $173,704, which aligns perfectly.

Therefore, if BTC’s price remains above the revised orange and red warning levels, see below, we still expect Bitcoin to reach approximately $164K by the end of November or early December, before the next multi-month bear market begins.

*Warning levels for the Bulls: first, blue, at $113,143 (There is a 25% chance that the uptrend is over); second, grey, at $121,020 (50% chance); third, orange, at $117,981 (75% chance); and fourth, red, at $114,866 (100% chance that the uptrend is over).