Bitcoin (BTC) Falls to Support Zone Of Consolidation Pattern; Will It Break Down?

Bitcoin (BTC) is close to breaking down from a corrective pattern that had been in place since June 18. If this occurs, it would be expected to lead to new lows.

Bitcoin has been falling underneath a descending resistance line since the end of March. The line caused a rejection on June 7, which led to a local bottom of $17,622 on June 18. 

The price increased slightly since and created two higher lows. However, it failed to even reach the descending resistance line and was instead rejected by the $21,700 horizontal resistance area. 

The daily RSI has yet to move above 50 and was rejected by the line the same time as the price was rejected by the $21,700 horizontal level. On the other hand, the RSI is still holding on above its ascending trendline (green). A breakdown from the line would likely confirm that the price is heading lower.

Short-term breakdown

A closer look at the six-hour chart paints a mostly bearish outlook. 

Firstly, the price has been trading inside an ascending parallel channel since June 18. Such channels usually contain corrective structures, meaning that an eventual breakdown would be expected. 

Secondly, the six-hour RSI has broken down from its ascending trendline and is below 50. 

BTC wave count

The wave count suggests that BTC has been trading in a five-wave downward move (yellow) since the end of March. The presence of this structure makes it likely that BTC is currently in wave four. 

If it breaks down, a likely target for the bottom would be found at $16,725. This target is found using the 0.382 length of waves 1-3.

The long-term wave count suggests that BTC is in the C wave of an A-B-C corrective structure (red) that has been developing since the all-time high of $69,000 was reached in November 2021. 

Giving waves A and C a 1:1 ratio would lead to a long-term low of $12,100, given that the $16,726 level fails.

For Be[in]Crypto’s previous bitcoin (BTC) analysisclick here.

The post Bitcoin (BTC) Falls to Support Zone Of Consolidation Pattern; Will It Break Down? appeared first on BeInCrypto.

Earning Passive Income With Crypto

Related Posts

SHIB Metaverse: How Will it Impact the Price of Shiba Inu?

SHIB Metaverse: Shiba Inu is one of the best-known cryptocurrencies on the market, and was launched in August 2020. A little over 5 months ago, it announced…

PoW Miners Rake in Profits Mining ETH Until the End, Ethash Networks Expect a Boost, JPMorgan Strategists Say ETC Could Benefit

In just over a month’s time, The Merge is likely to be implemented on the Ethereum blockchain and the network’s proof-of-work (PoW) miners will be forced to…

Another Stablecoin Depegs From USD Parity, Polkadot-Based AUSD Loses 98% in Value

2022 has been the year of broken stablecoins as a myriad of dollar-pegged crypto assets depegged from their dollar value this year. On August 14, the Polkadot-based…

Weekly NFT Sales Show Improvement, Fantom and Immutable X NFT Volume Spikes

Non-fungible token (NFT) sales managed to climb higher during the last seven days than the previous week’s overall sales. This week’s NFT sales managed to jump over…

Aave Responds to Blocking Addresses Over Tornado Cash Clampdown

DeFi lending protocol Aave Protocol said the TRM API on its app was responsible for blocking addresses that received ETH from unknown sources through Tornado Cash. In…

Brazilian Crypto Investment Platform Bluebenx Stops Withdrawals Under Hack Allegations

Bluebenx, a Brazil-based cryptocurrency investment platform, suspended withdrawals last week due to an alleged hack that made the company lose more than $31 million. The company announced…