Bitcoin (BTC) made another attempt at breaking out above $44,400 on March 2 but was unsuccessful. There is ample support below the current price, suggesting that another breakout attempt could occur soon.
Bitcoin has been increasing above an ascending support line since Jan 24. On Feb 27, it rebounded from this support and created a large bullish candlestick the next day. This led to a local high of $45,400 on March 2.
However, BTC once again failed to break out above the $44,400 horizontal resistance area and was rejected by it for the fourth time (red icons). Since resistances get weaker each time they are touched, an eventual breakout above this resistance seems to be the most likely scenario.
If a breakout occurs, the next resistance level would be found at $51,100.
BTC breaks out
The six-hour chart shows that BTC has broken out from a descending resistance line prior to reaching the aforementioned high. However, it has yet to move above its February highs of $45,821.
If a short-term retracement occurs, the closest support area would be found at $41,200. This support is created by the:
- Long-term 0.382 Fib retracement support level (white)
- Short-term 0.5 Fib retracement support level (black)
- Previous descending resistance line
Wave count analysis
The most likely wave count suggests that BTC began a five-wave upward trend on Jan 24. If correct, it’s currently in wave four of this structure.
The most likely level for wave four to end would be between $42,500-$43,000 (white circle).
The area is a confluence of the midline of the channel connecting waves one and two (black), and the bottom of the channel connecting waves on and three (white).
Following this, the fifth and final upward leg would be expected.