Will Bitcoin Finally Break Out Above $10,000?

The Bitcoin price is currently trading inside an ascending triangle and has been doing so since reaching a high on May 14. At the time of writing, it was trading very close to the resistance line, and approaching the end of the triangle, which is projected to occur on May 23 at the latest. Even though the ascending triangle is considered a bullish pattern, there is a considerable bearish divergence developing in the RSI.

Bullish Bitcoin Scenario

In the bullish scenario, the price is still correcting from the May 9-14 upward move, doing so inside an A-B-C-D-E wave count. Therefore, if the price breaks out, the rally is likely to be rapid, reaching a top of around $10,900, which is found by projecting the length of wave (1) to wave (3).

Bearish Scenario

In the bearish scenario, this is still an A-B-C retracement that has been going on since the May 8 high at $10,065. This scenario presents itself more clearly when looking at higher time-frames. Relative to that May 8 high, the recent highs beginning on May 12 are slightly lower, so a descending resistance line is drawn that connects them. The price is still in the process of generating the C wave, which is likely to be the sharpest of the three and could end near $7,800.

To conclude, the Bitcoin price is trading either inside a bullish ascending triangle or has created a bearish triple-top pattern. Since both scenarios seem likely, the prudent play would be to wait for a clear breakout or breakdown before attempting to initiate a position. For those interested in BeInCrypto’s previous Bitcoin analysis, click here.