Bitcoin (BTC) is still trading in the lower part of a corrective pattern that has been in place since June 18th. The direction of the trend is not yet determined.
BTC has been trading within an ascending parallel channel since hitting a low on June 18th. Such channels usually contain corrective moves, meaning that an eventual collapse of them would be the most likely scenario.
Additionally, Bitcoin is trading in the lower part of this channel, raising the possibility that the move is corrective.
However, the channel’s support line is still intact and seems to have started a bounce. Additionally, the 6-hour RSI has moved out of its oversold territory after previously falling below it.
The last time this happened (green icon), Bitcoin initiated a clear bullish move.
So, whether BTC manages to move above the midline of the channel or instead breaks below its support line will likely determine the direction of the future trend.
Short term pattern
The two-hour chart shows that BTC has dipped below a descending resistance line since hitting a high on Aug. 15. The line has caused four rejections so far (red icons).
The two hour RSI is moving up (green line) but is still below 50. So while the resistance line is creating resistance against the price, the 50 line is doing the same with the RSI.
A breakout of this channel would likely take BTC towards the 0.382 Fib retracement resistance level at $22,500.
Conversely, a failure of the breakout and subsequent drop below $20,800 would likely result in a breakdown of the previously outlined channel.
BTC wave count analysis
The most likely long-term wave count suggests the bottom is in. However, there are two potential short-term counts.
The bullish suggests that Bitcoin has completed a leading diagonal and is now in the first part of an ABC corrective structure.
In it, Bitcoin will find support above $20,000 and continue its upward movement.
The second count suggests that Bitcoin has completed a complex corrective structure (black) and has now started a bearish momentum (yellow). This is consistent with the presence of the channel.
Whether Bitcoin breaks out of the channel or instead recaptures its midline will determine whether the count is bullish or bearish.
To be[in]Crypto’s previous Bitcoin (BTC) analysis can be found here
Disclaimer
All information contained on our website is published to the best of our knowledge and belief and for general information purposes only. Any actions taken by the reader based on the information contained on our website are entirely at your own risk.
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.