Bitcoin Bullish Consolidation Almost Complete

Summary Bitcoin consolidating above and below $60k, preparing for another run at all-time highs in $70-74k range. Wave structure suggests completion of the pattern, with a potential breakout move in September. Fear/Greed Index indicates more bearish sentiment to unwind, potential for a powerful 5th wave rally to $190,000. Since my last article on Bitcoin (BTC-USD), in which I called the bottom to the ongoing bullish sideways correction, the leading cryptocurrency has consolidated above and below the swingline $60k level, prepping for another run at the all-time highs in the $70-74k range. The most recent selloff appears to have put in a higher low. TheBullBear.com, TradingView One could also look at the above chart and see a reverse Head and Shoulders formation, with the left shoulder completing in early June, the head completing in late July, and the final run-up to the neckline to complete the right shoulder in progress now. A move above the $60k level breaks the short-term downtrend. That's not far away. In terms of wave structure, BTC-USD has a few legs to go before the abcde triangle pattern is fully completed, though the c-wave low has already been realized. Once it gets back above $60k for more than a day, it should run to $70-72k, completing the d-wave. Then, we would look for a high-level consolidation between $74-65k that would set the final stage for the next bull run. The daily chart tends to suggest we could see the breakout move come in mid- to late-September: TheBullBear.com, TradingView Here we can see that we are currently in the wave 4 position of a bullish impulse 5 wave pattern. Let's compare the wave 1-2 sequence with the current wave 3-4 sequence. Wave 1 peaked in April of 2023, and this was followed by a 183-day sideways Wave 2. Note the compression of the 20-, 50-, and 200-day Exponential Moving Averages at the time the correction was completed and the Wave 3 rally ensued. Also, note the behavior and position of the Relative Strength Index (in the lower pane). Now, have a look at current conditions. The similarities are striking. If the duration of the correction is the same, then this current formation should be completed around September 12. Here's a closer look at the daily: TheBullBear.com, TradingView The pattern is keeping to a nice falling flag channel. Price today is at levels seen in May, so the trend is firmly sideways in overlapping waves. Also, note that a break above $60k would also represent a break above the converged moving averages. Also, note the bull RSI divergence at the recent low, with the price making a lower low but the RSI putting in a higher low. Conversely, a break and close back below $53k would cast this analysis into doubt, and we would have to reconsider if that were to happen. The weekly chart shows a long sideways consolidation right at previous all-time highs, typically a bullish preparation for a rally. TheBullBear.com, TradingView Weekly RSI is right at support, the same level from which the last big rally commenced. Let's have a look at the Crypto Fear/Greed Index. Alternative.me Note that when the Wave 2 correction ended on October 13, the index was at a moderate reading of 44 after reaching a low of 30 about a month before. At its recent low, the index registered an extremely fearful reading near 20, with a high fear of 27 still persisting in spite of a sharp price recovery from the lows and new all-time highs not far away. This means there is much more bearish sentiment to unwind than when wave 3 began, and therefore much more bullish fuel that should drive the "fear of missing out" wave 5 rally, once the breakout happens. It's also worth noting that in Bitcoin bull movements, the 5th wave is typically the most powerful, far exceeding the percentage gains of waves 1 and 3. But if wave 5 here simply matches the 180% move of wave 3, then it would reach a price of $190,000. This is smack in the middle of the $100-$300k range that I have called for in previous articles . If, on the other hand, Bitcoin were to get back down to the $53-50k region, I would become concerned about the validity of this analysis. At that point, the uptrend from the November 2022 low would be in jeopardy or broken, and I would be forced to reconsider this analysis and perhaps take a different viewpoint. My take is we've got 2-4 weeks of consolidation below the $74-72k resistance range before the next Bitcoin bull run begins. See my previous articles on Bitcoin for more detail and in-depth analysis. Thanks for reading, and I look forward to your comments and questions.