A crypto strategist who correctly called Bitcoin’s (BTC) The 2018 bear market low indicates that a rebound is likely in sight for the king of crypto.
Pseudonymous analyst Smart Contracter tells his 216,900 Twitter followers that he expects Bitcoin to rally in the near term before BTC ignites another leg towards its target below $16,000.
“Five-[wave] down that fakeout high range now on four o’clock [chart], which is a confirmed trend reversal in my view. We expect further dips down the range after getting a countertrend bounce over the next few days[s].”
Smart Contractor is a popular practitioner of Elliott Wave Theory, an approach to technical analysis that attempts to predict future price action by following crowd psychology which tends to come in waves. According to the theory, a bearish asset typically rebounds after performing a five-wave pullback before resuming its downtrend. Looking at the analyst’s chart, he appears to be predicting a short-term breakout for Bitcoin en route to $17,500 before another five-wave correction toward $15,600.
Crypto Strategist Also Says Bitcoin Looks Weak On The Longer Time Frame After BTC Bulls lack to support last week’s rally.
Smart Contractor also closely monitors the US Dollar Index (DXY), which measures the value of the dollar against a basket of fiat currencies. Traders are watching the performance of the DXY as a strong index suggests that investors are turning to the safety of the US dollar at the expense of risky assets like cryptocurrencies.
According to the analyst, the DXY looks bullish on the monthly chart after eliminating its diagonal resistance.
“We also had a multi-month diagonal break ending in DXY on Friday which is not good for risk asset bulls.
Again, time to start getting defensive, stay safe out there.
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