The Bitcoin bull market is just going through the same 3 steps it has taken in its previous bull markets.
Seasoned trader Steve Courtney of CryptoCrewUniversity has been repeating his mantra for a good while now that Bitcoin is doing what it does every bull market, and that thus far it is following the pattern which puts it in stage one of the bull market.
Courtney points out that right now Bitcoin is holding above the 200-week moving average and therefore even if it comes down to test it, which would take it down to around $27,000, all would be perfectly fine as long as this huge last line in the sand holds fast.
The trader’s next area to keep an eye on is the relative strength indicator (RSI) where Bitcoin needs to continue building a base structure above the mid level. Here, on the weekly time frame, support can be found at the 51 level. Courtney has the view that this is all-important, and should Bitcoin fall below and make this resistance, a lot of trouble could be heading Bitcoin’s way.
The Stochastic RSI, which measures momentum is Courtney’s next port of call. The veteran trader points out that every 6 months there is a cross on the Stochastic RSI and remarks that each one of these crosses heralds the biggest moves for Bitcoin.
For the previous cross, Bitcoin rallied from about $25,000 up to just under $32,000, from which it has fallen to its current level of around $29,000.
For the 3 steps, Courtney states that step number 1 is triggered by the Pi Cycle. A cross up for this indicator always leads to a huge rally which is then met by resistance that is not broken for quite some period of time.
However, this part of the bull market may not be plain sailing. Courtney says that if price does not hold above the red line, it will always fall to the green, quite a drop in price, leading to an extended phase 1, but which would still mean that Bitcoin stays in its bull market unless falling below the green line.
For his second step Courtney uses the Dynamic Traders Index which tells him when Bitcoin moves into phase 2 of the bull market. He remarks that this indicator is not showing that we are near phase 2 of the bull yet.
For Courtney, phase 2 is when price holds support above the resistance at $30,000 (phase 1) and then consolidates for many months. A breakout and consolidation above this would lead to stage 3 and big increases in price action until the top of this particular bull market is reached.
Due to reducing gains in each successive bull market, Courtney is of the opinion that Bitcoin probably won’t reach $100,000, which runs contrary to the view of most other analysts. Time will prove him right or wrong.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.