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Bitcoin (BTC) Bounces by 12% Following Drop to $20,855

2 mins
Updated by Geraint Price
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In Brief

  • BTC has broken down from an ascending support line.
  • It is facing minor resistance at $22,650.
  • BTC might have completed a five wave downward movement.
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Bitcoin (BTC) bounced significantly after reaching a low of $20,855 and has possibly completed its corrective structure.

BTC has been falling since it broke down from an ascending support line on June 10 (red icon). The decrease has been swift and led to a low of $20,855 on June 14. This is the lowest price since Dec 2020. 

The price bounced on June 14 and created a doji candlestick with a long lower wick (green icon). However, despite the bounce, the RSI is still following a descending resistance line. A breakout from this line would be required on order for the bounce to be considered a reversal.

Short-term bounce

The upward movement since the aforementioned low looks impulsive, due to it being a five-wave increase. Additionally, the price has broken out from a short-term descending resistance line. 

Currently, it is facing resistance at $22,650. An increase above this level and its subsequent validation as support would go a long way in suggesting that the bottom is in.

BTC wave count analysis

The short-term wave count suggests that the price has completed a five-wave downward movement (black) measuring from the end of March. 

The $20,825 low and subsequent bounce were made at a confluence of Fib targets between $21,850 and $22,650. The targets are given by the 1.61 external Fib retracement of wave four (black) and the length of wave one (white).

So, it is possible that a bottom has been made.

As for the long-term count, it is possible that BTC has just completed wave four (white) of a long-term five-wave upward movement that began in Dec 2018.

A decrease below the wave one high at $13,880 (red line) would invalidate this particular wave count.

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

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Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

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Valdrin Tahiri
Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona School of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst. (I do not have a discord and will not contact you first there. Beware of scammers)
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