Bitcoin Analysis for 2020-02-20 [Premium Analysis]

Bitcoin Price Highlights

• The Bitcoin price created a bearish engulfing candlestick.
• It is barely holding on to the support line of an ascending channel.
• There is support at $9,150 and $8,750.
• There is resistance at $10,400 and $10,900.
• The price is trading inside a short-term descending channel.

Ascending Channel

The BTC price is trading inside an ascending channel. On Feb 19, it created a massive bearish engulfing candlestick that dropped it to the support line of the channel. The candlestick transpired with very significant volume, increasing the validity of the price decrease. The price briefly reached the $9,150 support offered by the 0.382 Fib level and moved slightly upward. Strong support is found at the 0.5 Fib level at $8,750 in case the price continues to break down from this channel.

Possible Correction

The aforementioned decrease makes it possible that the price is in the correction, which could possibly follow an A-B-C wave count. In addition, the RSI has again fallen below the 50-line, invalidating the pattern.  If an extended C-wave transpires, it could end near the $8,750 support area at the 0.5 Fib level.

Short-Term Channel

In the short-term, the price is trading inside a descending channel, currently being right at the support line of this channel. It has been trading very close to this line for the past eight hours, unable to initiate an upward bounce. This adds to the previous sentiment since a decrease of such magnitude would be expected to be followed by a bounce if the price aims to head upwards. To conclude, the Bitcoin price created a bearish engulfing candlestick and decreased all the way to the support line of the long-term ascending channel. This could have been the beginning of a slightly longer correction that takes the price to $8,750. For those interested in BeInCrypto’s previous Bitcoin analysis, click here.