Bitcoin Analysis for 2020-02-26 [Premium Analysis]

Bitcoin Price Highlights

• The Bitcoin price broke down from an ascending support line.
• The daily RSI has fallen below 50.
• There is support at $9100 and $8300.
• The price could soon begin the fifth and final wave of an Elliott formation.

Ascending Support Line

No matter how you draw the ascending support line, the Bitcoin price seems to have broken down below it. It has currently reached the $9100 support area. This is very significant since the next important support area is found at $8300. A price decrease below this support area could easily trigger a rapid drop. The price has just reached the 50-day moving average (MA) and is possibly validating it as support. Also, the daily RSI has dropped below 50 after 53 days. This indicates that the price is in a bearish market and calls for an extended correction. However, the RSI is relatively close to the 50-line so it is possible that it jumps back up again — especially if the current daily candlestick closes bullish.

Current Decrease

Since January, this is the third time that the Bitcoin price has retraced and validated the previous resistance area. The decreases have also been similar, being nine, 10, and 13 percent respectively each time. Unless the price drops below this support line, the current movement seems more like a normal retracement than a full blown correction.

Future Bitcoin Movement

The most likely movement seems to be a five wave Elliott formation, which would take the price to $12,000. In order for the formation to remain valid, the Bitcoin price would have to bounce here. A daily close below this area would indicate that we are heading towards $8300. To conclude, the Bitcoin price has decreased all the way to a significant support level and validated the golden cross. We believe a bounce will transpire at the current level.