Bitcoin (BTC) reached a bottom of $56,516 on May 1 after forming a smaller degree W-4, which was not anticipated. However, BTCUSD staged a five-wave rally (grey W-i) and bottomed inside the grey W-ii target range of $60+/1.5K. To confirm that the low is in place, Bitcoin needs to break above the 20-day Simple Moving Average (20d SMA) and close above the blue 50d SMA. If this occurs, BTCUSD can potentially break the upper descending grey trend line of the Bull-flag pattern, indicating a bullish trend and a target of around $92K.
An Important Low in May
An overlay of the Crypto Fear & Greed Index with Bitcoin’s price chart for the last year reveals that the June and September 2023 lows coincided with below-average readings, while the January low saw below-average sentiment as well. The Fear & Greed Index reading of 42 on May 2 matches previous bearish sentiment at significant recent price lows. With a long-term bullish outlook for BTCUSD and an expected target range of $105-140K, the bulls need to demonstrate their commitment by rallying back above the 50d SMA.
“Thus, although we remain bullish over the long term for BTCUSD and expect it to reach $105-140K, the Bulls have their work cut out for them. They must show they mean business by at least providing a rally back above the 50d SMA.”
- Bitcoin formed a complex smaller degree W-4, reaching a low of $56,516 on May 1.
- To confirm the low, Bitcoin needs to break above the 20-day SMA and close above the 50-day SMA.
- If the above conditions are met, Bitcoin can potentially break the upper descending trend line of the Bull-flag pattern, indicating a bullish trend and a target of around $92K.
- The Crypto Fear & Greed Index reading of 42 on May 2 matches previous bearish sentiment at significant recent price lows.
- The bulls have their work cut out for them, as they need to rally back above the 50-day SMA to strengthen the bullish case.
