Bitcoin price action: Two possible scenarios - 6000$ or 2000$?

Bitcoin price action: Two possible scenarios – 6000$ or 2000$?

Bitcoin is recently pulled back from 5500$ Resistance and currently trading above 5000$. There is no clear sign of the next trend as of now, But we will come to know in a few days of price action. In this article, we are covering two possible scenarios about bitcoin next price action.

Consensus effect on Bitcoin price

Consensus’19 is approaching in may, we need to understand the fact that Consensus could be used a fundamental indicator to derive Bitcoin price action. Consensus event had effected Bitcoin Price in the past, I believe it will do this time as well.

Consensus’18: Price jumped by 8% before the event, dropped during and after the event.

Consensus’17: Price started jumping few days before the event, continuous jumping during the event, recorded over 60% growth in a week time.

Consensus’19: Consensus is going to be held in between 13-15 May this year. It would be interesting to see how the price will react this time. We are expecting at least a 10% jump in price before or during the event based on historical price performance.

Now, lets explore two Possible Price action Scenarios keeping Technicals in mind.

Bullish Scenario #1

This is how a typical Bullish Market structure looks like:

Two things to notice here in this chart –

LTC/BTC price initially broke above 200 Daily MA in Jan’19, But it followed by a massive sell off, 200 Daily MA broke down as a result. But Here Price Bounced back from 0.5 FIB Level. Ideally for continuation of any bull run – Price should bounce back from 0.5 FIB Level which happened here.
50 Daily MA meet above 200 Daily MA – A golden cross is formed , which continue the run later
Currently – LTC/BTC is sitting at a typical bullish structure where 50 Daily MA is trending above 100 DMA and 200 DMA.

Now Let’s look at Bitcoin/USD Chart

BTC/USD Weekly chart is current overbought, so there is high chance that we will go through a Multi weeks correction. So I Believe, A Correction wave is definitely in play which is suggested by Daily and weekly chart.

To be in the bullish scenario, Price should not drop below 0.5 FIB Level which is at around 4400$.
Price should consolidate around 4400-4600$ for few days before next run.

If the price does not drop below 4400$, and consolidate above 4400$ before next leg up then – A Golden Cross will be formed which is strongest indicator to support bull run. We could expect Bitcoin to cross 6000$ in this scenario around 2nd or 3rd week of May. That could be the start of the next Bullish cycle.

Bearish Scenario #2

In this scenario, Bitcoin needs to break 21 Weekly MA Support for more downside.

To be in the bearish scenario, Bitcoin needs to drop below 0.236 FIB Level. If the price drops below 3800$ and stays below that for couple of days then there is a higher chance that price will make a new lows below 3000$.

A Break below 55 Monthly MA could take the price to 2000$ Range. Monthly Moving average will play a deciding role in Bitcoin price action in coming days/months.

Conclusion

Bitcoin is Bullish as Long it stays above 4400$.
The next Bullish Cycle will start when Bitcoin price will break above 21 Monthly Moving Average.
Bitcoin will turn Bearish if it drops below 3800$.
The next bearish cycle will start when Bitcoin price will break below 55 Monthly Moving average.