Bitcoin (BTC) Breaks Short-Term Resistance While Its Daily RSI Is Back Bullish area.
Bitcoin was trading below a descending resistance line since the beginning of April. This downward movement led to a long term low of $17,622 on June 18.
Since then bitcoin has been mostly moving upwards and broke the line on 18th July. Although the price turned lower initially, it managed to rally substantially on July 27 and formed a major bullish candlestick. In turn, this validated the $21,600 area as support.
More importantly, the daily RSI bounced off its ascending support line (green icon) and moved above 50 once again. This is considered a bullish signal, and means that the bullish structure remains intact as long as the RSI is trading above the ascending support line.
If the upward move continues, a nearest resistance area can be found at $29,370, which is formed by the 0.382 Fib retracement resistance level.
short term breakout
The six-hour chart shows support finding support from the daily time frame and a breakout from a shorter-term descending resistance line. Later, BTC managed to move above the 0.618 Fibonacci Retracement resistance level at $22,960.
Finally, the six-hour RSI broke above a descending resistance line and moved above 50, both of which are considered to be signs of a bullish trend.
BTC wave count analysis
The most likely short-term wave count shows that bitcoin has completed a five-wave upward move in wave two (yellow). Inside the pattern, the sub-wave count (black) created a complex WXY corrective pattern, with a precise 1:1 ratio of W and Y waves.
The rise of July 27 is likely the start of wave three from the same movement. Sub-wave counts are shown in black.
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