Technical outlook:
Bitcoin had dropped through $28,600 late on Thursday before finding support. The crypto has produced a sharp rally since then, closing higher at around $30,500. Also, note that a classic Engulfing Bullish pattern is complete on the daily chart suggesting further upside against the $28,600 lows. Potential remains through $42,000 at least going forward.
Bitcoin has carved a meaningful downswing between $69,000 and $25,500 earlier as seen on the above daily chart. The crypto is producing a counter-trend rally since then and is well poised to push through the $40,000 initial resistance as projected here. Once complete, we can expect the second wave lower within the overall corrective rally.
Bitcoin could terminate the anticipated counter-trend rally toward the $48,000-50,000 area, which is close to the Fibonacci 0.618 retracement of the entire drop between $69,000 and $25,500. Traders might be prepared to open fresh long positions and also add further around current levels with a potential target of around $42,000 in the near term.
Trading plan:
Potential rally towards $42,000 and $50,000 against $20,000
Good luck!
