Bitcoin (BTC) is moving within the range of its December 2021 lows, but showing strong signs of a potential bullish reversal.
On December 23, 2021, BTC broke a descending resistance line in place from its record high on November 10. This indicated that the previous fix is now complete.
Subsequently, it fell back to the levels preceding this breakthrough, ie close to $ 46,000. This potentially created a double dip pattern, which is often seen as a pattern of a bullish reversal.
Additionally, Bitcoin’s MACD and RSI generated significant bullish divergences. This is a bullish situation, in which the drop in price is not accompanied by a similar drop in momentum. [ou élan] of sale.
Previously, this divergence has been a catalyst for very significant bullish movements.
The closest resistance zone to Bitcoin’s price is between $ 52,400 and $ 58,750, created by the resistance levels of the 0.382-0.618 Fibonacci retracements.
BTC short-term range
The six-hour chart shows that since the beginning of December, BTC has been trading within a range of $ 46,300 to $ 51,800. On December 27, the price was rejected by the resistance zone and has been declining ever since.
Since December 30, Bitcoin’s price has been trading inside the support level of the range. As on the daily chart, there is a significant bullish divergence within the RSI. Thus, one would expect an upward movement towards the middle line of the range and potentially towards the highs of the trading range.
Wave count
The most plausible wave count suggests that BTC is still stuck in a corrective pattern. It is currently trading just above the support level of the 0.618 Fibonacci retracement which should help boost price.
If the W: Y waves have a 1: 1 ratio, which is common in such structures, Bitcoin’s price could hit a local high of $ 55,850. This peak would be within the aforementioned resistance levels.
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