Current price action
At time of writing, BTC is priced around $45,000 USD. BTC had seen a strong move from $29,000 USD and is currently looking to break above the upper purple resistance line to make ATHs.
BTC/USD
BTC/USD formations
BTC is currently forming a cup and handle formation, with BTC having completed the cup. The handle formation should see BTC pullback very slightly.
The cup and handle with a bullish pre-trend, is an overall bullish formation. Below is a typical drawing of what a cup and handle formation looks like. The cup will see a corrective move down, with a bottom formation (e.g. inverse H&S) at the bottom of the cup. From here there should technically be an impulsive move up, with a slight handle pullback. The cryptocurrency will find an upper resistance line (the red line). This resistance line should be broken after the handle.
C&H formation
The C&H formation is currently being seen with numerous cryptocurrencies e.g. STORJ. Below we can see the current cup for STORJ, with a handle formation expected in the near future.
STORJ/USD
Below is the current BTC C&H formation. BTC is currently within the handle stage. Therefore a BTC increase in price looks likely in the near future, with the potential for a long position.
BTC/USD C&H
BTC/USD C&H price targets
Due to the current formation, BTC is highly likely to break ATHs again. This would see BTC > $42,000 USD. From here BTC should rise to $52,000 USD, this is 61.8% of the pre-formation impulsive wave.
BTC/USD bullish formations
BTC long term potential
BTC has previously seen two parabolic movements and is currently within its third parabolic movement.
The first BTC parabolic movement saw BTC rise from $10 USD to $1200 USD. From there, there was then a retrace to $160 USD. The next run saw BTC increase from $160 to $20500 USD. The current parabolic wave which we are in has seen BTC rise from $3500 to $48000 (so far).
As seen below, BTC (when compared with the first two waves) is currently around half way through its parabolic movement on the logarithmic scale. If BTC mimics the second parabolic wave, we could be looking at a maximum price of $300,000 USD per BTC.
BTC/USD $300K potential
Below we can see the EWs for this potential move up to 300K, BTC is currently within the 3rd wave of the impulsive move. There could be a potential pullback, however, between $52K – $61K.
BTC/USD EWs
BTC Musk
During the writing of this BTC Intelligence Report, it was reported that Elon Musk’s TSLA has invested $1.5 billion USD into BTC. This is extraordinary news for BTC and represents a potential change in sentiment of cryptocurrencies from the traditional markets. TSLA is the fourth largest S&P 500 organisation, with a market capitalisation of 819 billion USD. Due to such a large organization investing in BTC, this could open a gateway for other organisations to follow suit.
BTC has seen an instant reaction from the news that TSLA are investing in BTC, with BTC increasing 14.36% in only 45 mins. The news of TSLA investing in cryptocurrencies comes after weeks of Elon Musk showing his support for another cryptocurrency – Dogecoin (DOGE).
DOGE
Musk has been recently flirting with the cryptocurrency industry, most notably with the meme coin DOGE. DOGE has seen an eye watering 3100% price increase within the last 91 days, firmly down to Musk and other celebrity DOGE promotions.
Snoop Dogg DOGE trend tweet
Elon Musk DOGE trend tweet
DOGE/USD chart
What does the TSLA buy mean for the BTC TA
The TSLA purchase of BTC will likely form an overall Bart Simpson formation – a reference to his hairstyle. This is when there is a major green spike (usually due to positive fundamental news). From here the cryptocurrency will see major volatility at the top before a swift downturn to return the cryptocurrency towards its original trajectory. Below we can see an example of a Bart Simpson formation between July – September 2020.
BTC/USD Bart Simpson formation
The original trajectory of BTC can be seen below. After a substantial rise in price (+36%), BTC saw major losses, going down significantly (-21%). Although the overall positive trajectory was maintained (bullish) with BTC rising +7% overall during the formation.
BTC/USD trajectory
BTCs current trajectory – potential long target once sell off is complete
BTC currently has an overall positive trend line, as indicated with the red line below. It seems highly likely that BTC will find major support within the purple area, with the $42K – $41K acting as a net for BTC. From here, bears will likely lose control as buying interest picks up again and BTC will resume its parabolic movement. The lower purple line is the 0.618 Fibonacci retracement from the last impulsive BTC wave, while the upper purple level is the R1 PP and the previous ATH resistance (08/01/2021).
BTC/USD support levels
The Bart Simpson formation was triggered by BTC breaking below the symmetrical triangle shown below.
BTC/USD
BTC Conclusion
In conclusion BTC is looking immensely bullish. Recent cryptocurrency news has only been positive recently. On the whole, indicators are still bullish on the daily timeframe. Although in the short term BTC does look slightly bearish.
