The price of Bitcoin has increased by almost 17% today but has encountered strong resistance at the prior support level which was broken on the way down. As the price moved to the upside in a five-wave manner we are now likely to see another downturn which could lead to a breakout to the downside.
- Price increased by the momentum has been stopped out at the resistance area around the 0.5 Fib level.
- A downturn would now be expected as the price moved in a five-wave manner.
- The downturn could lead to a breakout on the downside if we’ve seen the completion of the lower degree three-wave correction after an impulsive sharp downfall.
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Bitcoin Analysis BTC/USD
From yesterday’s low at $9826 the price of Bitcoin increased by 16.95% as it came up to $11491 at its highest point today. The price is currently being traded at $11280 as it came up to the broken support level for a retest of resistance.
As you can see from the hourly chart, the price came up to retest the broken ascending trendline made from 10th of June at the intersection with the 0.5 Fibonacci level which makes this area a significant resistance zone.
The price came up in a five-wave manner which is why now considering the encountered resistance we are likely to see another downturn.
From last Friday we have seen a recovery in a three-wave manner with the price now forming a lower high.
This could be a three-wave correction which would be the second wave of a lower degree from a higher degree correctional structure as previously a higher degree five-wave impulse to the upside ended.
The price action has made a still unconfirmed descending channel on the interaction with the 0.5 Fib level today which will be validated if the price starts moving to the downside from here.
As we’ve seen the price coming to the significant resistance area and has made a lower high I would be expecting a downside move shortly which could either be the prolongation of the descending channel structure with another lower high for a retest of its resistance level before a breakout to the downside, or the end of the correctional structure altogether after which the third wave on an impulsive manner should start.
The price of Bitcoin could have completed its three-wave correction on the yesterday’s low with the five-wave impulse seen today being the first wave of the next impulsive move to the upside, but at this point, I don’t believe that’s likely.