Bitcoin (BTC) retires after hitting a month high near $ 46,000
Written on: Februarie 12, 2022
Title : Bitcoin (BTC) retires after hitting a month high near $ 46,000
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Bitcoin (BTC) retires after hitting a month high near $ 46,000
Bitcoin (BTC) has fallen after hitting a high above $ 46,000 on February 10 and appears to be in the process of completing a corrective framework. On February 10, Bitcoin hit a high of $ 45,821 before declining. The high was reached right at the resistance level of the 0.618 Fib retracement at $ 44,900.
The subsequent decline created a shooting star candle pattern. This is normally considered a bearish pattern, as the selling pressure has managed to create a long upper wick and a bearish close. The fact that it took place in an important area of resistance further increases its significance.
Short-Term Movement
The six-hour chart shows that BTC has exited an ascending parallel channel that had previously been in effect since January 24th. The price validated the level as support twice later, on February 9th and 10th (green icons). However, the next day it broke back into the canal (red icon). Technical indicators are showing some bearish signals, but they do not confirm a reversal of the downward trend.
The MACD, which is created by the short and long term moving averages (MA), is falling but is still positive. The RSI, which is a momentum indicator, is also falling. However, it is still above the 50 line and an ascending trend line that has been in effect since January 24th. As long as this level is not broken, the ongoing uptrend remains intact.
The two-hour chart also shows considerable weakness. This is particularly visible in the bearish divergences that have developed in the RSI and MACD. This weakness preceded the ongoing bearish move. Currently, it appears that BTC is in the process of validating the resistance line of the channel once again. The main support area is at $ 41,000. This target is the 0.5 Fib retracement support level and the midline of the parallel ascending channel.
BTC Wave Count Analysis
The more likely long-term wave count indicates that BTC has already bottomed out. As for the short-term count, it appears that BTC is in wave four of a five-wave upward move (red). The sub-wave count is shown in black.
The rise made on the 10th Fed and the subsequent fall suggests that the wave took the form of a flat correction. So far, sub-waves A and C have had an exact 1: 1 ratio, which is the most common in such structures. The next most common ratio is 1: 1.61. This would lead to a low of $ 41,335, also hitting the channel's midline and the aforementioned 0.5 Fib retracement support level.
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