On July 16, the Bitcoin price reached a high of $11,058. A decrease ensued. The next day, the BTC price reached a low of $9084. After reaching a similar low the next day, the price began a rapid upward move.
Is this move the beginning of an uptrend, or is it just a response to previous decreases? Keep reading below in order to find out.
For our previous analysis, click here.
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Bitcoin Price: Trends and Highlights for July 19
- BTC/USD recently broke out from a descending channel.
- It is facing resistance from the 10-day moving average.
- There is resistance near $10,700 and $12,000.
- BTC is possibly following a pattern from the 2018 crash.
Previous BTC Price Movement
Since reaching a high of $11,900 on July 13, the Bitcoin price has been decreasing — trading inside the descending channel outlined below:
On July 18, the price broke out from this channel.
The breakout transpired with massive volume, greatly increasing its significance.
Let’s take a look at a different time-frame to see if this move has any long-term implications.
A look at daily candlesticks suggests that we do not yet have a confirmed upward move.
First, the highlighted portion of price movement above looks like a reversal pattern.
However, yesterday’s daily candle is still covered within the body of the previous bearish candle.
Furthermore, it looks as if this is just a retest of the previous support area from which we broke down on July 14.
A price close above $11,000 would invalidate this idea and will likely take us to the next resistance area near $12,000.
A look at the 10- and 20-day moving averages (MA) refutes the possibility of further increases:
A bearish cross transpired on July 13.
Since then, the Bitcoin price has been trading below both MAs.
Also, yesterday’s move was stopped once it reached the 10-day MA.
At the current time, it looks as if it might initiate a downward move.
To conclude, a look at a longer-term time-frame combined with moving averages suggests that this is just a response to previous price decreases.
There is an interesting similarity between the price movement after the all-time high was reached in December 2017 and the current move.
During both moves, the price :
- Underwent an A-B-C Correction after reaching a high
- Initiated an upward move after the completion of the C wave
- The upward move stopped at the 0.382 fib level of the entire drop
If the price movement is identical, the BTC price should make a lower high soon before resuming its downward movement.
The Bitcoin price recently broke out from a descending channel.
Even though the breakout transpired with massive volume, we believe that the price will soon continue its downward movement, after possibly making a lower high.
Do you think the BTC price will continue to increase, or are further decreases in store? Let us know in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
Images are courtesy of Shutterstock, TradingView.