Bitcoin: A potential path back to $25,000 (and beyond).

Conditions in Bitcoin have been improving over the past month since bottoming out around $18,000 in late June. After analyzing several factors such as market breadth, multiple time frames, and inter-market correlations, I am looking for Bitcoin to move slightly lower (maybe around $20,000) before ultimately making a move up to re-test the $25,000 area over the intermediate term (4-6 weeks, give or take). However, if Bitcoin breaks the $18,000 lows, the situation would likely deteriorate rapidly - but thats a story for another post. In the meantime, waiting for a bit more of a pullback could offer some nice opportunities with favorable risk/reward ratios for Long side trades.

In the future, I plan go into greater detail about the underlying analysis that lead me here, so if this is something that you'd be interested in seeing, please let me know in the comments.

Thanks for reading, and best of luck out there.

Comment:

I suppose underestimated how quickly this idea would play itself out but nevertheless, this week saw a brief pull back into the $20,000 area (low of $20,700) and came within about 500 points of hitting $25,000. I think there are good odds for continuation, but I took profit on my long trade and will wait to see what happens next.

I plan to do a more thorough analysis in the coming days, but here's a rough idea of how I'm seeing the crypto market. The key to everything is Bitcoin Dominance (BTC.D). The probabilities suggest BTC.D to trade in a range between 41% - 44%. In this scenario, I'd look for sideways to slightly upward trade in BTC around the $25,000 level. A break in BTC.D below 41% would put $30,000 in play as a major target. Lastly, I think a rally in BTC.D above 44% would signal another leg down in BTCUSD, pushing it under $20,000.