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Bitcoin (BTC) made a bullish breakout of the short-term resistance level, but still is traded inside a longer-term corrective pattern.
On June 18, BTC formed a low of $17,622 and has been trading inside an ascending parallel channel ever since. 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 this channel, trading near its support line. This reinforces the likelihood that the current move is a correction and a bearish breakout should be expected.
However, the 6-hour RSI index has left the oversold zone and gives bullish signals. When this was observed the previous time (green icon), BTC launched a phase of significant growth.
The RSI formed an rising low, but the price did the same. So we can’t talk about any bullish divergence signals.
In general, the further direction of the trend will largely depend on whether the price will be able to move above the median line of the channel or make a bearish breakout of the support line.
Short-term dynamics of BTC
On the 2-hour chart, you can see that the market has been moving along the downward resistance line since August 15 (the moment of the formation of the local maximum). Now the price is trying to turn it into support. If successful, we can expect continued growth.
The 2-hour RSI also supports bullish scenario. The indicator is trying to break above the 50 mark. In addition, it moves along the ascending support line, which generally forms an “ascending triangle” pattern on the chart.
In the event of a rebound, the nearest resistance will come into play at $22,470. This is the Fibo level of 0.382 retracement. However, even if the BTC rate reaches it, it will still not be enough to recover above the median line of the previously allocated channel.
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