“the Bulls may have failed again, with the crypto’s price now below its 10-day, 20-day, and 50-day Simple Moving Average (SMA) and toying with the lower edge of the Ichimoku Cloud (red and orange horizontal arrows, respectively). Therefore, our alternative EWP count presented in our last update is becoming more likely: the “dreaded” (grey) W-X-Y, protracted correction. A standard W=Y targets ~$54K, which is close to the late April low, the 200d SMA, and the lower trendline of the Bull flag.”
Thus, although we remain bullish over the long term and expect BTCUSD to reach well over $100K before the run since the 2022 low is over, the Bulls may have lost this battle to win the war. Since the early June (Wave-X) high, enough waves are now in place to consider the Wave-Y complete. See Figure 1 above. Moreover, BTCUSD has reached the 38.2% retracement of the green W-3, which is a typical (green) 4th wave targeted. Lastly, potential positive divergence is developing on the daily RSI5 (dotted green arrow).
However, there are no signs of a bottom yet. It will require at least a daily close back above the (Red) 200-day simple moving average (SMA), followed by recapture of the blue 50d SMA and the Ichimoku cloud in a five-wave fashion. That will turn the current five red horizontal arrows into five green arrows, signaling the trend has changed from down to up. Thus, although our downside target zone has been reached (Y=W, 38.2% retracement), suggesting that the low is most likely in, we now need to wait for the next subtle clues to know our bottom call was correct. In that case, we expect BTC to reach the adjusted ideal target zone of $88,940-91,150.
