Executive Summary
Based on a “modernized” application of Elliott Wave Theory and technical indicators such as moving averages and candlestick patterns, the overall assessment points to a potential end to Bitcoin’s current uptrend. Despite earlier uncertainties in labeling recent price action as an impulse wave, the overarching evidence—including CME gaps, repeated lower-wick candles (outliers), and a moving-average death cross—suggests a possible significant downturn ahead.
In the short term, two scenarios emerge:
- Running Flat → Drop
- A running flat pattern would allow for a strategic short entry once the pattern completes, offering a tight stop-loss and a potentially high reward if Bitcoin declines sharply.
- Regular ABC → Drop
- Though deemed less likely, if a regular ABC pattern develops, a short position could be taken once the pattern finalizes. If Bitcoin breaks well above 96k with strong momentum and solid candlestick closes, the bearish thesis would need to be re-evaluated.
Meanwhile, Bitcoin dominance is rising, implying that altcoins are underperforming. As funds appear to be exiting altcoins, broad altcoin investments (e.g., ETH, XRP, BNB, DOGE) currently carry higher risk. Candlestick patterns in certain coins (e.g., frequent lower wicks) suggest larger players may be unloading positions, further weakening the outlook for the altcoin market.
In sum, from both a short- and long-term perspective, caution is advised. While Bitcoin’s potential decline might open opportunities for well-timed short positions, the market’s next major moves will depend on how patterns and price levels develop—especially near key resistance and gap zones.