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Bitcoin is trading in the area of supporting the corrective pattern, which has been present on the chart since June 18. A bearish breakout will lead to an update in the lows for BTC.
SINCE the end of March, BTC has been declining along the downward resistance line. On June 7, the price rebounded from this level, which led to the formation of a local bottom of $ 17,622 on June 18.
After that, the price rose slightly and formed two rising lows. However, she never managed to reach the aforementioned line of downward resistance. Instead, bitcoin rebounded from the horizontal resistance area of $21,700.
The daily RSI is still below the 50 mark. It bounced off this barrier at the same time that the BTC rate bounced off the horizontal level of $21,700. On the other hand, the RSI is still holding above its uptrend line (green line). A bearish breakthrough of this level can confirm. That the price headed south.
Short-term bearish breakthrough
On the 6-hour chart, the picture for bitcoin is painted mainly in bearish tones.
First, here you can see that BTC has been trading inside an ascending parallel channel since June 18. Such channels are usually associated with corrective movements. Thus, since the price rises inside this channel, this may mean that a bearish breakthrough from this pattern is likely in the end.
Secondly, the RSI on the 6-hour timeframe made a bearish breakthrough of the support line formed by the uptrend, and is below the 50 mark.
BTC Wave Analysis
Outcomes wave analysis suggest that the price since the end of March is in a five-wave bearish structure (yellow). The presence of a correction channel on the chart suggests that we may be dealing with part of wave 4.
In the event of a bearish breakthrough, the likely target of the market and the potential basis may be the area of $ 16,725 (calculated as the Fibo level of 0.382 wavelengths 1-3).
A longer-term analysis suggests that BTC completes the corrective structure of A-B-C (red), originating from the historical highs of November 2021 at $ 69,000. Now the price is in wave C of this structure.
An A:C wave ratio of 1:1 will bring the price to a long-term low of $12,100 – in case the $16,726 level can’t hold up.
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