Bitcoin BTC Cryptocurrency Elliott wave analysis 18 May 2018
Bitcoin is dropping close to $8000 after losing 20% in less than two weeks. The following 18-20 May Bitcoin price prediction looks at BTCUSD forecast based on Elliott wave theory.
In the last two weeks, Bitcoin dropped 20% after a strong rally to $10000. It is likely the drop is part of a bearish correction. At the end of this correction, perhaps price would rally above $10000. How far could the correction goes? The next bearish target is $7000.
In the previous updates, we discussed about the completion of an impulse wave rally to $10000. Usually when this happens, a correction in the opposite direction should follow. This clue provided short opportunities for short term traders. The buyers might have to wait for the end of the correction. Is this really a correction or price means to drop further?. If it's a correction, how or when will it end? All these questions are not very easy to answer. In fact it's impossible to predict accurately, the future moves of the market always. However, Elliott wave theory can give us useful clues that can put us ahead and give us the edge on which we can make decisions. Let's look at what we have in the last update where we used the chart below.
Wave 4 went higher than we had in the last update but price has not moved into the territory of wave 1 thereby validating an impulsive wave (a). Price could drop further to $7750 to complete wave (a) before wave (b) bullish correction. Price could play out differently, but this is a high likely scenario. A trader looking to short might want to wait for the next correction - wave (b) while a buying trader might wait till the end of the deep correction at wave (c). We will see how BTC plays out in the coming days and then adjust our forecast to fit in.
Price is still moving as expected, therefore, no need to adjust anything. The chart below shows wave (a) is getting close to completion.
The last leg of wave (a) is near completion within a channel. A break above the channel could lead to wave (b) around $8900-$9200. If the rally is corrective, we could see price dropping to $7000 afterwards. Stay tuned for the next update.
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