Bear Trend Begins To Take Hold In Bitcoin For First Time Since October 2020

Tony "The Bull" Severino

Last Updated: June 11, 2024 2:12 pm

3 mins read

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Bitcoin price has now pulled back a full $13,000 from 2021 high to low. Yesterday’s massive bearish, red candle is one obvious sign that the trend is turning. However, a technical analysis tool used to gauge the strength of trends also confirms that bears have taken over the reigns from bulls and it could lead to a short-term downtrend.

Bitcoin Bears Regain The Upper Hand, Reclaim Crypto For First Time Since October

Bitcoin is undeniably in an uptrend, and according to comparisons with past market cycles, things are only just getting warmed up.

But that doesn’t mean that the higher timeframe trend can’t be up, while the shorter-timeframe intraday trends heads down – or that price action across days and weeks can’t temporarily turn bearish.

That’s exactly what has happened recently, with the top cryptocurrency shaving as much as $13,000 off its price from high to low. Yesterday’s daily close left behind an extremely bearish candle and reminder that asset prices don’t only move up in a straight line.

The recent parabola might have been broken, which could suggest a sharper correction is coming. Some of the best traders and analysts are expecting more downside before things turn back up.

The Average Directional Index and DMI show bears have taken over daily timeframes | Source: BTCUSD on TradingView.com

The Average Directional Index confirms the bearish price action. The red DMI moving so sharply above the green is a clear sign that bears are now in control of the cryptocurrency’s daily trend once again.

The ADX itself is still well below 20, so the trend hasn’t yet fully taken hold. What’s notable is that this is the first time bears have reclaimed Bitcoin since October when FOMO spun out of control.

Trend Strength Measuring Tool Shows Bulls Aren’t Down For The Count Just Yet

The ADX is used to gauge the strength of the underlying trend, and like most tools, higher timeframes provide the most dominant signals.

Bears have won on the daily, but on weekly timeframes, however, the same tool shows that bears don’t really have a chance, and any downward momentum will be short-lived before bulls regain control.

The Average Directional Index and DMI show bears have taken over daily timeframes | Source: BTCUSD on TradingView.com

Oftentimes, corrections in assets are healthy, confirm resistance as support, and reignite buying interest by reaching more attractive price levels.

Could the pullback be exactly what Bitcoin needs to refuel and rocket higher? Or are there simply too many similarities shared with the 2017 peak to ignore the potential of a longer downtrend in the weeks ahead?

Featured image from Deposit Photos, Charts from TradingView.com

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

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Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.

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