BTC/USDT Market Analysis – 23 September 2024

22. Sept.

Currently, Bitcoin is experiencing a WXY corrective pattern, characterized by prolonged ranges and frequent false breakouts. This pattern is known for trapping traders on both sides, often forming double or triple tops before final capitulation occurs.

Wave Structure Overview:
Wave W has completed as a sharp correction, signaling the initial downturn of the structure.
Wave X followed as a flat correction, incorporating another flat within it and forming two double tops. This structure aligns with the characteristics of flat corrections, which tend to be extended and misleading for market participants.
Current Market Sentiment – Wave Y Outlook:
We are currently in Wave B of the Y Wave. Wave B is expected to face resistance in the range of 0.786 to 0.886 Fibonacci retracement levels. However, there is a possibility that the price could extend to the -0.236 Fibonacci level, resulting in a new flat correction. This scenario poses significant risk for traders, as this level might create a false sense of a confirmed breakout, potentially trapping participants in another bear trap.

The target for Wave Y is estimated between 44,013 and 40,819 USD.

It is crucial to remain cautious, as Wave B could still exhibit some bullish momentum, but the potential for a reversal leading into Wave C of Wave Y is the most pronounced. This impending capitulation could lead to further declines before a potential bottom is established.

Bearish Bias and Risk Mitigation:
Given the current market setup, my outlook leans more bearish, and I advise caution when initiating any market buy orders in the event of a bullish breakout. For a confirmed bullish reversal, it is preferable to see at least 2-3 daily candles closing decisively above the current resistance level before considering any long positions. This would provide greater confidence in the sustainability of the breakout and mitigate the risk of falling into a bear trap.