See More

Bitcoin Cranks Back Above $10,000 With a Vengeance

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

In Brief

  • -The Bitcoin price is trading inside a long-term resistance area near $10,300.
  • -There are short-term signs of reversal, but the daily trend looks strong.
  • -The price has possible finished wave 3 of a long-term five wave formation.
  • promo

During the week of July 20-27, the Bitcoin (BTC) price increased considerably, reaching a high of $10,170 and further solidifying its bullish trend.
However, the price is currently trading inside a long-term resistance area, and a short-term pullback would be expected.

Weekly Bitcoin Outlook

During the week of July 20-27, the Bitcoin price created a bullish engulfing candlestick, reaching a high of $10,111 and a close only slightly below $10,000. Currently, the price is very close to the $10,300 resistance area, which has been in place since September 2019. A breakout and close above this level could trigger a very rapid upward move. However, the price has been rejected each time it has reached this area, creating some type of bearish candlestick. The current upward trend has been in place since March 12. Indicators show that while the price is still in an upward trend, the trend is losing strength. This is visible by the lower volume during the increase and MACD reading, which has been decreasing since June. However, the latter seems to have broken a bearish momentum trend, so there are mixed signals.
BTC Weekly
BTC Chart By Tradingview

Strength of the Trend

The daily chart shows that the price has almost reached the June 1 high of $10,373. This would be a very likely reversal area if the price increases, possibly creating a double-top. Technical indicators show that the trend is still strong. Volume was high yesterday, the MACD is increasing, and the RSI is not yet overbought, nor has it generated any type of bearish divergence. Therefore, while the price is overextended, there are no clear reversal signs yet.
Bitcoin Daily Time-frame
BTC Chart By Tradingview
However, the hourly chart shows several reversal signs. There is decreasing volume during the recent highs, the RSI has generated a bearish divergence, and the MACD has begun to lose steam. Furthermore, the price has created a harami pattern, which, when coming after an upward move can be read as a reversal sign. Thus, while the trend is clearly bullish, a short-term pullback would be expected.
BTC Bearish Divergence
BTC Chart By Tradingview

Wave Count

Beginning on July 6, BTC seemingly began a five-wave Elliott formation. Currently, it has just finished the third wave, which has become extended, or is very close to doing so. We can also outline the sub-wave count for wave 3 (in green below). In it, the fifth wave has become extended. A common level for an extended fifth wave would be the 1.618 Fib of waves 1-3. This would give us a high of $10,440, only slightly above the June 1 high. It is important to note that on June 1, the price first created a harami pattern, and followed that up by creating an evening star, a bearish candlestick pattern created by three candlesticks. This is a strong reversal sign, and its highs are expected to act as resistance in the future. While we cannot determine reversal levels until the price actually reaches a high, a likely place for the impending wave 4 to end would be at the top of the previous channel at $9,800, or at its middle around $9,650. A decrease below $9,450 would likely invalidate the wave count.
Bitcoin Wave Count
BTC Chart By Tradingview
The shorter-term wave count indeed suggests that we are nearing the end of the move. It is possible that the price will create another pump and reach the previous target of $10,440, but it does not seem likely that it will go much higher than that this time around.
BTC Wave Count
BTC Chart By Tradingview
To conclude, while BTC is clearly in a bullish trend, it has reached a long-term resistance area. A short-term retracement is expected. For our previous 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