Bitcoin (BTC) is due for a swift recovery towards $6,000 as long as it closes the current weekly candle above trend line support. RSI for BTC/USD points to a similar outcome on the weekly chart. Bitcoin (BTC) recently broke market structure which led to a crippling correction the likes of which we have not seen in the past. This correction or crash has now become a part of Bitcoin (BTC)’s outlook for years to come. The moment it broke below the $5,800 level, Bitcoin (BTC) completely shattered any hopes of a bullish comeback towards the end of the year. Some analysts like Tom Lee are still confident that Bitcoin (BTC) may rise to $15,000 by year end, but that is extremely unlikely under current circumstances. That being said, BTC/USD is long overdue for a short term recovery.
The price is expected to rally from current levels. Soon as Bitcoin (BTC) closes the current candle above $3,210, we are likely to see a green candle that is going to take the price above $4,000. The next one or two candles that follow will be expected to see Bitcoin (BTC) retesting previous market support at $6,000 which has now become a critical resistance. Too many people are expecting a pullback to $3,000 which is exactly why it is not going to happen. The price is likely to stage a reversal next week from current levels but that is not going to happen without some good old stop hunting that is going to teach complacent bears some important lessons. This short squeeze that we have been mentioning in our previous analyses is also long overdue just like a reversal at this point.
The bear market is about to come to its end, but the bears are still too confident about a strong pullback.