Bitcoin (BTC) has failed to make any kind of upward move after breaking out of a short-term descending wedge.
Bitcoin has been rising above an ascending support line since June 18. The line has been validated several times, most recently on 26 July. This led to a local high of $24,668 on July 30. During this period, the daily RSI, which is still above 50, is also following an ascending support line (green).
During the uptrend, bitcoin managed to break out of the horizontal resistance area of $21,750 and a descending resistance line that previously existed since late March. However, it has not started a significant growth yet. Rather, it is retreating after the breakout.
There is a strong support near the $21,750 level, which is formed by an ascending support line and a horizontal support area.
current pattern
The six hour chart does not give any clue as to what the trend direction is.
Firstly, it is possible that BTC is trading inside an ascending parallel channel, which is often considered a bearish pattern. As a result, an eventual breakdown from the pattern would be the most likely scenario. This possibility is supported by divergence (red circle) and there was a downside break below the $23,750 horizontal area.
However, the price is still trading above the midline of the channel and it appears to have been validated as support. As long as bitcoin is trading above this level, the possibility of a bullish breakout remains.
Finally, the RSI is moving freely above and below 50, which is considered to be a sign of a neutral trend.
Therefore, the six-hour chart provides a neutral outlook and does not help determine the direction of the next move.
short term btc breakout
The two-hour chart shows that BTC broke through a descending wedge on August 3. The breakout occurred after the price bounced off the 0.5 Fibonacci retracement support level.
However, bitcoin failed to make any major upward move and is trading back near the 0.5 Fibonacci retracement support level. This is an important level as the 0.618 Fibonacci retracement support at $22,225 could lead to a rally, but there is no horizontal support below it until $20,700.
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