Exclusive Bitcoin (BTC) Resumes Upward Movement With Short-Term Breakout

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In Brief
  • Bitcoin has bounced at the $30,000 support area.

  • It has broken out from a descending resistance line.

  • BTC is facing resistance levels at $41,200 and $48,175.

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Bitcoin (BTC) has been moving upwards since bouncing at the $30,000 support area on May 19.

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On May 24, it broke out from a short-term descending resistance line. It’s currently approaching the first important resistance area found at $41,200.

BTC bounces back

BTC has been increasing since May 19, when it reached a local low of $30,000. On May 23, it created a higher low and followed it up with a bullish engulfing candlestick.

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Since then, it’s managed to reach a daily high close of $40,600. The main resistance levels are found at $41,200 and $48,175. These are the 0.382 and 0.618 Fib retracement levels from the most recent drop.

Technical indicators provide some bullish signs. The MACD has generated three higher momentum bars. However, due to the bearish candlestick close yesterday, it did not generate a bullish reversal signal. 

The RSI has crossed above 30 after generating a bullish divergence. While the Stochastic oscillator has yet to make a bullish cross, it has begun to move upwards. 

Therefore, while the reversal is not confirmed, there are several bullish signs developing.

BTC Chart By TradingView

Short-term movement

The six-hour chart also supports this assessment. 

First, it shows that BTC broke out from a descending resistance line and its subsequent validation as support. 

Furthermore, both the RSI and MACD have turned bullish. The former has crossed above 50 while the latter is moving upwards. 

The significance of the $41,200 area is heightened since it’s also a horizontal resistance area.

BTC Chart By TradingView

Wave count

The wave count indicates that the decrease was an A-B-C corrective structure, in which waves A:C had a 1:1.61 ratio. 

This is likely the first portion of a flat or triangle correction. 

Therefore, we would expect the upward movement to continue at least until the 0.618 Fib retracement resistance level at $51,606 and possibly to the 0.854 Fib at $59,862.

An increase above the wave A low at $47,004 (red line) would confirm that this is not a bearish impulse.

BTC Chart By TradingView

For BeInCrypto’s latest bitcoin (BTC) analysis, click here.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
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Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona graduate 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.

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