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Bitcoin (BTC) Fall Continues Below $40,000 – Will Price Bounce Soon?

2 mins
Updated by Ryan James
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In Brief

  • Bitcoin's price has created a bearish weekly candlestick. The price fell below an important horizontal area.
  • The price action and wave count in multiple time frames suggests the BTC price will continue correcting.
  • Despite the bearish Bitcoin price prediction, reclaiming the $41,000 area will mean the local bottom is in.
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The Bitcoin (BTC) price has fallen significantly since January 11, decreasing below $40,000 this week.

So far, the downward movement is the second largest since the start of 2023. When will Bitcoin bottom?

Bitcoin Creates Bearish Candlestick

The technical analysis of the weekly time frame shows that the BTC price has increased since the start of 2023. The upward movement culminated with a high of $48,969 the week of the ETF approval.

However, the BTC price has fallen, creating a bearish weekly candlestick (red icon). The high was made right at the 0.618 Fib retracement resistance level. Bitcoin has fallen since, decreasing below $40,000 this week. 

Bitcoin Price Movement
BTC/USDT Weekly Chart. Source: TradingView

The weekly Relative Strength Index (RSI) gives a bearish reading. Market traders use the RSI as a momentum indicator to identify overbought or oversold conditions and to decide whether to accumulate or sell an asset.

Readings above 50 and an upward trend indicate that bulls still have an advantage, whereas readings below 50 suggest the opposite. The indicator decreased below 70 (red circle) and is moving downward.

What Are Analysts Saying?

Cryptocurrency analysts and traders on X are mostly bearish on the short-term BTC trend.

Altcoin Sherpa believes BTC will fall until reaching the 0.382 Fib retracement support level at $36,400.

BTC Analysis
BTC/USDT 3-Day Chart. Source: X

CredibullCrypto and TheTradingHubb are both bearish because of the wave count, suggesting that one more low is in store. The former tweeted:

Meant to go over LTF $BTC count in my last vid update but forgot to cover it, so here’s a chart. Further supports the idea of one more small push down before our full-on reversal.

However, IncomeSharks goes against the crowded opinion, suggesting that BTC will increase in the short-term to $44,000.

BTC Price Prediction: When Will the Price Bottom?

A closer look at the technical analysis from the 2-day time frame suggests that the BTC price will still be correct because of the wave count.

Technical analysts utilize the Elliott Wave theory to ascertain the trend’s direction by studying recurring long-term price patterns and investor psychology. The most likely count states that BTC is in wave four in a five-wave upward movement (white).

Based on the lengths of waves two and three, the correction will likely end in March – April (highlighted

Also, since waves two and four need to alternate with each other, wave four will likely be sharp, reaching the 0.5-0.618 Fib retracement support levels at $37,100 – $34,200.

Wave Count
BTC/USDT 2-Day Chart. Source: TradingView

The sub-wave count (black) suggests that BTC is still correcting in wave A of an A-B-C corrective structure. If the count is correct, BTC will fall by another 8% to the 0.5 Fib retracement support level at $37,100 before bouncing.

Bitcoin (BTC) Price Count
BTC/USDT Six-Hour Chart. Source: TradingView

Despite this bearish BTC price prediction, reclaiming the $41,00 resistance area will mean the local bottom is in. Then, the price can increase by 10% to the closest resistance between $43,800-$45,000.

For BeInCryptos latest crypto market analysis, click here.

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Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Valdrin-Tahiri.jpg
Valdrin Tahiri
Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona School of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst. (I do not have a discord and will not contact you first there. Beware of scammers)
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