Photo by Kanchanara on Unsplash
Bitcoin has been staging a recovery in recent sessions, but from an Elliott Wave perspective the structure still appears corrective rather than impulsive. While the short-term momentum has improved, the broader technical picture suggests the rally may still be part of a larger corrective phase within the overall market structure.
Traders should therefore remain cautious as price approaches a major resistance zone between $74,000 and $80,000, which could determine the next significant move.
On the daily timeframe, Bitcoin’s rebound continues to resemble an ABC corrective rally rather than the start of a new impulsive bullish cycle.
BTCUSD Daily Chart
Within Elliott Wave theory, this structure could represent either:
Wave B of a larger correction, or
Wave 4 within a broader bearish sequence
Both scenarios imply that the current recovery may only be temporary before another downside move unfolds.
The key characteristics supporting the corrective interpretation include:
Overlapping price action, typical for corrective waves
Lack of strong impulsive acceleration
Recovery occurring after a clear decline rather than from a long consolidation base
As long as the rally remains below the $80K region, the probability remains higher that the market is still forming a corrective recovery within a larger bearish cycle.
Zooming into the 4-hour timeframe, the structure becomes clearer. The market appears to be progressing through wave C of the ABC correction.
BTCUSD 4H Chart
Wave C is often the final leg of a corrective move and can sometimes develop into ending diagonal or wedge patterns, especially when momentum starts to weaken as the move progresses.
Currently, price action suggests the potential development of a rising wedge pattern, which typically signals:
Weakening bullish momentum
Higher probability of a bearish reversal once the pattern completes
If the wedge structure completes near resistance, it could act as a trigger point for the next downside move.
However, a strong breakout above the $80,000 area would invalidate the near-term bearish outlook and suggest that Bitcoin is in a larger, higher-degree wave B corrective recovery.
For a detailed view and more analysis like this, you may want to join our live webinar today, Monday March 16 @ 15.00CET: DIRECT LINK
Comments
Log in or sign up to join the conversation.