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Andreas Zanin
Analysis | May 21, 2021

Outlook and forecast: BITCOIN, Crashes Will it Rally Back?

In terms of Bitcoin we have seen it fall hard in recent weeks we are off the lows will we continue to rally or is there more downside to come? After falling Below our updated view.

In our previous post on Bitcoin this week we noted that it had the potential to fall to 3000.00 and that target has been hit – To View Our Previous Post CLICK HERE

Cryptocurrencies generally got hit hard as we can see on the chart below and as we note in our previous post in any sentiment-driven market – There’s no internal income, or rate of return, to use as a valuation yardstick. The long Crypto trade before the big break was the most crowded long trade of all and a large number of speculators have now been burned.

In terms of Bitcoin Traders “They will soon turn from sellers to buyers as bitcoin’s historical trading pattern clearly shows that every single previous dump has been followed by a sizable rebound.” (ZEROHEDGE)

This is true – traders who watch Bitcoin tend to believe in that longer-term and will probably want to buy the dip. The view of most Bitcoin traders is it’s going far higher and will become a mainstream investment longer term so they want to buy “cheap”.

Bitcoin won’t achieve mainstream acceptance for the numerous reasons we outlined in our previous post but we would expect a rally before lower prices. Longer-term we expect Bitcoin to fall to the 2000 level.

Below our view of the key technical support and resistance levels…

Bitcoin Technical Analysis

After moving through the 3.000 level on the chart below we have bounced back above 3500 and view this as a good level to sell back through if we turn lower again. If we move higher we have resistance at 4500 then major resistance at 5000 and would look for bearish price action into these levels – of course, if you are bullish you could buy and target these levels. For us as we noted in our previous post we prefer trading the short side…

 

Research provided by LearnCurrencyTradingOnline.com

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