See More

Bitcoin (BTC) Validating Previous Resistance Level As Support

2 mins
Updated by Kyle Baird
Join our Trading Community on Telegram

In Brief

  • Bitcoin has broken out from a descending resistance line.
  • BTC is moving above a short-term descending parallel channel.
  • It has completed a short-term complex corrective structure.
  • promo

Bitcoin (BTC) is in the process of validating previous resistance levels as support, both in the short and medium-term.

BTC had been decreasing underneath a descending resistance line since reaching an all-time high price on Nov 10. The decrease continued until Dec 4, leading to a low of $42,000. 

After the low, both the RSI and MACD generated bullish divergences (green lines) for a period of 15 days. This is a bullish development that often precedes bullish trend reversals.

On Dec 21, BTC broke out from the resistance line and is currently in the process of validating it as support (green icon).

The next closest resistance area is found between $55,500-$58,700. This target area is created by the 0.5-0.618 Fib retracement resistance levels. 

Channel breakout

The two-hour chart shows that BTC broke out from a descending parallel channel that had been in place since Dec 7. 

Currently, it’s in the process of validating its resistance line as support (green icon).

The line also coincides with the previous resistance area at $48,100, which is now expected to act as support. 

Due to the confluence of horizontal and diagonal levels, the importance of this area is strengthened.

BTC count

The short-term count suggests that BTC has just completed what is likely a complex corrective structure (highlighted), as noted by the X wave (pink).

If correct, it’s now in the Y wave, which has an upwards direction. If it has a 1:1 ratio relative to wave W, it would lead BTC to a high of $55,400. This would complete a longer-term wave B.

Judging by the length of wave W, which was short, an upward move towards $55,400 would be expected to begin soon.

For BeInCrypto’s previous Bitcoin (BTC) analysis, click here

Top crypto platforms in the US | March 2024
Coinbase Coinbase Explore →
AlgosOne AlgosOne Explore →
Chain GPT Chain GPT Explore →
iTrustCapital iTrustCapital Explore →

Trusted

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.

Valdrin-Tahiri.jpg
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)
READ FULL BIO
Sponsored
Sponsored