BTC Headed To $39k - $40k This Week

Looks like Scenario #3 is playing out here as Bitcoin struggles to hold $42,500, an important support & resistance level from earlier this year and recently on the way back up to to $50k, triggering a pullback to it's rising 21 day EMA.

From here, I expect BTC and the Altcoins will bleed further lower, with BTC bottoming between $39k and $40k before rebounding sharply, possibly as early as Friday.

The weekly and monthly RSI have also rejected at key resistance levels, indicating further downside in the short term. If we close at or near the weekly lows, we could see further downside from there but this market feels like it wants to go higher.

For that to happen, we would need to see a bounce off the weekly lows to have a bullish candle print on the weekly chart, and some indication the US stock market will bounce in the short term.