Bitcoin (BTC) is in a tricky situation as on the one hand the price faces a decline down to the $8.2k level but at the same time the big players are concerned about any potential decline getting out of hand. There is still the possibility of a rally to the upside according to most retail bulls and the market makers and whales earnestly want to capitalize on that. They also do not want the ‘trapped bears’ an opportunity to get out of their shorts should the price decline further. This means that even if the price declines down to $8.2k from here, it will most likely be a quick decline followed by a bounce up and a rally towards the $9.2k level.

However, it is important to realize that for the past few months weekend activity has mostly been inconsequential. Whatever happens on the weekend is either reversed at the end of the weekend or the week that follows. Bitcoin CME Futures closed the week at $8,700 but BTC/USD has declined well below that level on most exchanges over the weekend. So, it declines to the $8,200s there will be a big gap left to be filled as Bitcoin CME Futures start trading on Monday and hence that gap could get filled and BTC/USD could continue to rally towards $9.2k invalidating the decline that happened over the weekend. This is the most plausible scenario because the S&P 500 (SPX) also closed the last trading day in the green and it is likely to see some sort of relief in the first few days of next week.

It is important to realize that the whole Coronavirus situation is pretty bad. Renowned Economist Nouriel Roubini says that it may not be such a far-fetched idea to think that the Coronavirus development could lead to disaster for the markets. Now, think about this for a minute. The whole situation is bad and everyone knows it but the stock market is very unlikely to just keep on declining when everyone is expecting it. This is one of those times where we could see some sort of good news that would divert the attention of retail traders for a while.

As for Bitcoin (BTC) and the cryptocurrency market, this may be a time when we see Bitcoin dominance (BTC.D) decline below the 200-moving average on the 4H time frame once again. It does not appear very likely at the moment but the market makers and whales are running out of time to pump BTC/USD higher before halving. If the S&P 500 (SPX) starts the week in green, that would be the greenlight for Bitcoin (BTC) to start rallying higher for the foreseeable future. The most probable scenario would be a rally towards $9.2k followed by a decline to $7.7k and then a rally again to $11.7k followed by the beginning of a major downtrend that will likely see BTC/USD decline below $6k in 2020.