Bitcoin (BTC) rose significantly on February 7 and broke out of its short-term pattern, making it likely that a bottom is already in place.
The weekly chart shows that BTC has gained significantly during the week of Jan 31 – Feb 7 and has continued to move up this week.
If BTC manages to rise above the current price, it will form a morning star pattern, which is often considered a bullish reversal pattern as the entire January 17-24 shortfall will be negated. Therefore, it is important for BTC to reach a weekly close above $43,070 to complete this pattern.
daily movement
The daily chart provides a bullish outlook due to bullish readings from MACD and RSI, both of which are trending up.
The first is positive and the latter has moved above 50, both indicating a bullish trend.
BTC is currently approaching the 0.382 Fibonacci retracement resistance level at $46,712.
Furthermore, BTC has already broken above an ascending parallel channel on the six-hour chart. This is a sign that an uptrend is impulsive and could possibly reach new local highs in the near term.
BTC wave count analysis
Due to the ongoing uptrend, it seems almost certain that the longer term wave count is indicating that a bottom is already in place.
As for the short-term wave count, BTC is either fully completed or close to completing wave three (red) of a five-wave upward move. Sub-wave counts are shown in black.
The February 8 high of $45,492 was formed at the confluence of Fibonacci levels, i.e. 1:1.61 ratio of waves 1:3 (red) and 0.618 sub-waves length 1-3 (black).
Therefore, it is possible that BTC may retest the resistance line of the channel before resuming its uptrend.
For BeInCrypto’s previous Bitcoin (BTC) analysis, click here