After witnessing a sharp recovery that took Bitcoin from around $52,000 to $58,000, we find ourselves at a pivotal moment. The question remains: Is this recovery part of a larger corrective structure, or is it the beginning of an impulsive move to new highs? As of now, the chart presents two possible scenarios that will likely unfold over the coming days.
Bullish Scenario:
In this case, the previous decline from $58,000 was simply a Wave 4 correction within a larger bullish impulse wave. We are now potentially in Wave 5, which could take us to a new local high above $58,000, confirming that the recent recovery was impulsive and signaling the continuation of the uptrend.
Key indicators supporting the bullish outlook:
- The structure of the upward movement suggests impulsive characteristics (i.e., five clear waves).
- Bitcoin is trading within key resistance levels around $58,000, and a decisive break above this zone would indicate that this is indeed Wave 5.
Bearish Scenario:
Alternatively, we could be looking at a more prolonged correction. In this case, the rise from $52,000 to $58,000 could be part of a corrective wave 2, following a completed Wave 1 decline. If this scenario plays out, we would likely see a rejection at the $58,000 level, followed by a move down to new lows, potentially below $52,000.
Key indicators supporting the bearish outlook:
- The structure of the recovery may also resemble a corrective ABC pattern.
- A rejection at the current Fibonacci resistance levels would suggest that this rally was corrective, leading to a deeper decline in Wave 3.
What to Watch For:
- A break above $58,100 would likely confirm the bullish scenario, indicating a continuation higher.
- A break below $55,000 would strongly suggest the bearish scenario, with further downside likely in Wave 3.
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