Reading time: ~2 m
Bitcoin (BTC) has formed several weekly bearish candles and gives a number of bearish signals on the daily timeframe.
In November 2021, bitcoin reached an all-time high of $69,000 and has been losing ground ever since. As a result, in June 2022, BTC formed a local minimum of $ 17,622.
After that, the price made a rebound (green icon), testing the strength of the horizontal area of $ 19,300 as support, and began to strengthen.
The market managed to reach a maximum of $ 25,211 on August 15, but at the end of the week of August 15-22, BTC formed several candles of bearish absorption. This offset a significant portion of the price increase from the June base.
In addition, the weekly RSI is still moving along the downward resistance line and remains below the 50 mark. Thus, the weekly trend continues to be bearish.
Current BTC pattern
The daily chart reflects a predominantly bearish picture. This is primarily due to the daily RSI, which made a bearish breakout of the upward support line, and also sank below 50. Such signals are often harbingers of an impending price drop. In addition, the decline in the RSI under the 50 mark is considered a sign of a bearish trend.
Also, bitcoin fell below the $22,000 area, although earlier it seemed that it made its bullish breakout. Now this area can play the role of resistance.
The 6-hour timeframe demonstrates that since June 18 (the moment of the formation of the minimum), BTC has been trading inside the ascending parallel channel. Such channels are usually associated with corrective patterns. This means that in the end, the most likely scenario may be a bearish breakthrough from it.
In addition, bitcoin is now at the bottom of the channel. This reinforces the likelihood that the market will make a bearish breakout from this pattern.
In this case, the price may be poisoned to update the lows.
BTC Wave Analysis
The most likely long-term scenario wave analysis suggests that in the process of moving from the historical maximum, bitcoin completed the formation of the corrective structure A-B-C (red color), where the ratio of waves A: C is 1: 1.61. This is the most common coefficient for such structures.
Having a channel also gives us an alternative scenario. Within its framework, BTC has just completed wave 4, and then we are waiting for another, final, decline, after which the market will find the bottom.
However, for the implementation of this scenario, it is necessary that bitcoin makes a bearish breakthrough from the channel.
All information contained on our website is published in good faith and objectivity and for informational purposes only. The reader is solely responsible for any actions taken on the basis of information received on our website.
#BTC #formed #weekly #candle #bearish #takeover