fell below $30,000 earlier today and is now dropped by over 50% from that achieved in November 2021 all-time high. Besides that Bitcoin has found a useful purpose outside of speculation, there is no apparent reason for the current sell-off.
Analysts looking for one anyway point to the overall market weakness in other assets like and commodities, as well as the strong .
Although there is definitely a correlation between different types of tradable assets, we would like to propose another explanation. It’s all about the Elliott Wave principle and its price patterns, and it’s much easier to prove since it’s not an afterthought.
Indeed, Elliot Wave analysis helped us predict Bitcoin’s decline almost two months in advance. Just look.
BTC/USD 4-hour chart, March 13, 2022
The chart above showed that the plunge from $69,000 to just under $33,000 was a five-wave impulse. This pattern, labeled 1-2-3-4-5, meant that more weakness was to be expected once the corrective recovery to follow was complete.
the correction appeared to be a simple ABC zigzag still in progress with wave B being a triangle.
Wave C was still missing on this count, so it made sense to prepare for a near-term rally towards ~$50,000.
Once there, however, the bearish 5-3 wave cycle would be complete and it would be time for the bears to return.
If the downtrend resumes, targets below $33,000 would be expected.
Is Bitcoin ‘Cheap’ After Its 58% Plunge? It depends who you ask
That was the logic we followed almost two months ago. It had nothing with inflationCryptowhales or Elon Musk to do. All it took was a map and an eye for Elliott Wave patterns. As it turned out, that was more than enough.
BTC/USD 4-hour chart, May 10, 2022
Wave C couldn’t even reach the $50,000 mark. The best the bulls could pull off was a rally to $48,234 by March 28th. From there, the selling pressure continued to mount, eventually leading to a new low of $29,731 so far.
The question of what exact reasons prompted people to sell their bitcoins now becomes irrelevant when you are able to predict the sale.
The next question, now much more important, is how far are the bears willing to go? Is Bitcoin a Good Investment at Current Prices? There cryptocurrencies have no intrinsic value, an objective fact-based answer is impossible.
A common misconception is that an asset is cheap simply because it was previously more expensive.
This is a dangerous path. What happens when market volume decides the price is still not worth it? What if it suddenly realizes that the asset is actually worthless?
The good news is that this is exactly what Elliott does, staying ahead of the market crowd Wave analysis often allows us to do. That’s why we want to continue to rely on it.
Source: Crypto News Deutsch