There's going to be quite an interesting and important video on bitcoin because I'm going to show you in this video three scenarios, three potential scenarios like if they happen it means that a potential bull market in bitcoin has been confirmed and therefore we would have to adopt a much more bullish outlook on bitcoin.
Show you this and explain to you what this potentially means. So as I explained in my previous video, there are right now to likely projections on bitcoin one on the left, which is the slightly more bearish scenario, uh, which shows this could potentially be a way for correction on bitcoin and the one on the right's projection too, which shows and more bullish scenario that we could potentially be in the wave three. I taught potential uptrend on bitcoin right now I can tell you that both these scenarios carry about an equal probability, so about a 50% probability on both these scenarios.
By the way, I should just say that despite that fact, I actually think that the projection number one on the left hand side, I still think this is the more likely scenario for reasons that I explained in my previous video. Uh, the reason actually is because of external factors because there is so much positive and bullish sentiment right now in Bitcoin, which is kind of a contrarian indicator. Uh, the fact is right now that a lot of people right now, a lot of folks have become extremely bullish on bitcoin and that usually is a red flag. It's a contrarian indicator when it comes to any market, in fact. So that's why for now I still consider the projection on the lefthand side, this bear scenario here to be more probable. Now the question is this, how do we go from this to this? How do we know with a high degree of probability, let's say an over 75% probability that we have actually entered the bull market?
That's scenario number two. Projection number two here is much more likely. In other words, how do we know that a potential blue market has? Luckily been confirmed in Bitcoin so that we would have over 75% probability that in fact we are indeed in a bull market. So let's go now to the charts. So I'm going to show you three scenarios and if either one of these scenarios plays out, that could potentially increase the probability that we have entered and major bull market in Bitcoin snare a number one actually is quite simple. Scenario number one is called breaking the ceiling. The ceiling that I'm talking about here is this rectangle formation you see here, and it should come as no surprise why I've drawn this rectangular pattern on my chart. There's a daily chart of Bitcoin, that rectangular pattern in fact show the resistance, which is right now between 6,000 and 6,800 on bitcoin.
It's gonna be a very important resistance level on bitcoin. And in fact what we're saying here in this scenario is that if bitcoin, okay, if bitcoin managers to successfully break through and let's say if it closes above the 6,800 resistance level and stays above the 6,800 resistance level, that could likely indicate we've entered a bull market in bitcoin. I want to make sure I'm clear on this because in this scenario, not only this bitcoin have to get above this rectangle formation, but also it needs to stay above the 6,800 level for the bull market to be confirmed and that is going to be very tough indeed for Bitcoin to do that. I'm not saying it's impossible, but I'm saying it's not very likely because any moves, I think that any moves into this rectangle formation between 6,000 to 6,800 are going to be met with strong resistance and I think that indeed, I think it's very likely bitcoin will likely fail at these levels and drop back down and two below the 6,000 level, probably below the 5,500 levels as well.
So I actually consider this first scenario to be rather unlikely, but nonetheless it is a scenario we have to consider. Bottom line is this, if bitcoin and it's a big, if, if bitcoin managers to get above the rectangle formation and stay above 6,800 then likely a bitcoin bull market has been confirmed and therefore we'd have to change our minds and adopted much more bullish outlook on bitcoin. I should just say this, that if bitcoin gets above 6,800 and then suddenly within a week or so closes back below 6,000 than no, that would indicate this was a false breakout. It actually, it would be a better scenario and we'd be looking for a major sell off back down the previous lows. All right guys, so that's scenario number one as the ceiling that bitcoin is to break if indeed it actually manages to break that level. Let's go to scenario number two.
Now [inaudible] is quite simple to understand or number two is simply if we go in a monthly chart, what you're seeing here is a monthly timeframe of bitcoin and what I've done here on this chart is I've shown you an important moving average, which is called the 21 monthly moving average. The Blue Line you see here on my chart, okay, right now bitcoin just slightly above the 21 monthly average, but it has not yet closed above that level just yet. Now in this scenario, what we're saying is if bitcoin managers to successfully close above the 21 monthly average twice, in other words, if we see two consecutive months of prices closing above the 21 monthly average, the Blue Line you see here, then a likely bull market has potentially been confirmed. Let me give you an example. Let's go back to the year 2015 and you will see something very interesting.
Take a look at this. You'll see the in the in the year 2015 in fact, after the last major bear market that occurred in bitcoin. Look what happened. Bitcoin came back up, rallied to the 21 monthly average, but failed to actually close above their level. It got rejected from that level. As you can see, that was a bearish scenarios. You can see right there. But look what happened here on the second attempt. On the second attempt, bitcoin actually succeeded. It closed above the 21 monthly average twice, by the way, not just once, but twice. And in this scenario, that is what we're looking for. We need to see two consecutive closes above the 21 monthly average. And if that happens, that could potentially confirm a bull market has started in bitcoin. Look what happened after that. After that happened, bitcoin started to go significantly higher.
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Okay, so let's go back now and look at this chart right now. As you can see right here. So a bitcoin currently is just edging above the 21 a monthly average that you see right there. The monthly average is about 5,260 5,261 now, right now we're above this level, but remember we need to see two consecutive closing months above the 21 monthly average in other wards for this scenarios be confirmed. We need to see not just a month of April above the 21 monthly, the average, but the month of May as well. So if we see two months, month of April and the month of May above the 21 monthly average, if that happens, that could potentially confirm a bull market has started in bitcoin similar to what we saw in 2015 by the way, do I think this scenario is likely? I do not know. I think that actually on the first attempt, I think the first attempt bitcoin is gonna make above the 21 monthly average potentially could fail.
So I think, um, likely potentially by next month or so we might see bitcoin getting rejected from these levels. I'm coming back down, but let's wait and see. Bottom line is this, even though I consider this scenario to be unlikely at present on the first attempt, maybe on the second attempt they might succeed, but on the first attempt above this moving average, I think it probably will fail, but we can just wait and find that if we get two consecutive close above the monthly average or not. All right guys. So let's go now to scenario number three, which is quite interesting and I've got to tell you out of the three scenarios that I'm going to show you, I think this third one as potentially more realistic and you're about to find out why. The reason why consider this third scenario to be more realistic is because I actually think that this current rally we're seeing here in bitcoin is likely to fail.
So even though we're seeing a nice major rally here in Bitcoin, I think on the balance of probabilities, this rallies unlikely to get above the rectangular formation I showed you, which is above the 6,000 6,800 level. I think it's unlikely to get above that level. I think we'll likely see this rally eventually fail. Uh, maybe near the resistance levels here. And then I'm looking for Bitcoin to potentially fall from resistance levels back down to the support levels, important support levels, which is this rectangular formation. You see down here, this blue rectangular formation, which is between 3,800, two, 4,000 levels, there's going to be a key support level on bitcoin. So what this means is this, and this third scenario, if bitcoin falls back down towards this rectangle, the formation, if it holds the support level, if it holds it, and then starts to do this in other wars, holds it and start to bounce and strongly move back up again like this.
So there's a major reversal that could actually potentially show that we have entered a bull market. Because why? Because it means buyers are stepping in at protecting bitcoin, add this rectangular formation. It means buyers are interested at these levels. So that's the third scenario which means that if bitcoin comes back down to the 4,000 to 3,800 levels and these levels hold and bitcoin starts to move back up again like this, that could potentially show that bitcoin Ashley has bottomed here and we could be starting another bull market potentially in bitcoin. Are you guys, again, I think out of the three scenarios of shown you here in this video, this third scenario is probably a more realistic, I don't think the first two scenarios are likely, but in any case guys, at least we have now three scenarios as to potentially showing to us when a bull market could like to start in bitcoin. And by the way, let me just say this also, it's quite important that if indeed, if this support level does not hold, and if bitcoin actually fails to hold on to the support level and falls below the 3,800 support level, if it fails the whole district tangle formation at the support level, then very likely we're heading back down to test a previous lows of February. And even the lows of December are guys. So guys, I hope this video is help and if it has, please give it a thumbs up.