The Bitcoin (BTC) price has been retracing since getting rejected by the $12,000 level on Aug 2 and Aug 10.
It is not yet clear if the current movement is corrective or an impulse that will bring new local highs.
Bitcoin Retraces After Double-Top
The Bitcoin price reached a top of $12,067 on Aug 10 and immediately fell. The decrease was preceded by bearish divergence in the 12-hour RSI (in red below). After the drop, the RSI generated a hidden bullish divergence and was able to propel BTC back to the $11,700-$11,800 region. Furthermore, the MACD has given a reversal signal in the 12-hour time-frame, even though it is still bearish on the daily chart. Volume has been higher during bearish candlesticks than during their bullish counterparts. These conflicting technical indicators show that the direction of the trend is not definitively clear.
Correction Or Upward Move?
While the price is following an ascending support line, the slope of the resistance line is not yet clear, so this could play out to be an ascending triangle or wedge. An interesting observation since the massive drop on Aug 2 is the presence of overlap in almost every new high. This is a sign that the upward movement is not an impulsive move but rather a correction, meaning the direction of the trend is to the downside. However, since the wave count is not clear, this is likely to be a complex corrective pattern rather than a simple A-B-C correction.
Short-Term Resistance
The appearance of numerous wicks also makes it tough to determine the slope of the ascending support. It is possible that the price has already broken down and is now in the process of validating the line as resistance. Furthermore, the price is between the 0.618-0.718 Fib levels of the previous decrease, making it a likely level for a reversal. The closest resistance level is found near $11,800 while the closest support at $11,450.
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 Conditions, Privacy Policy, and Disclaimers have been updated.
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)
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)
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