Bitcoin Pulls Back, But Holds Above $ 11,200 Support



Bitcoin Pulls Back, But Holds Above $ 11,200 Support

Bitcoin Pulls Back, But Holds Above $ 11,200 Support

  • Bitcoin Trades Between $ 11,200 Support and $ 12,000 Resistance

  • Short-term indicators signal a deterioration in the technical picture

  • The price is in the third wave of a five-wave Elliott structure

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The bitcoin (BTC) rate broke through an important resistance level, turning it into support. After a short-term pullback, the price should resume the bullish move

Trading range

The bitcoin rate has been increasing since September 8, when it reached a minimum of $ 9,825. The rise accelerated on October 8, provoking a breakout of the important resistance of $ 11,200.

Bitcoin Pulls Back, But Holds Above $ 11,200 Support

Then the quotes formed a lower wick, confirming the support status ahead of a new wave of growth. The local maximum of BTC was fixed at around $ 11,731. The next resistance is around $ 12,000.

BTC chart. Source: TradingView

Short term weakening

The 6 hours chart shows that despite the rally, the rally has recently started to show signs of fading. MACD and RSI decline, with the latter giving significant bearish divergence signals.

Moreover, BTC has formed a long upper wick, which indicates the presence of downward pressure.

BTC chart. Source: TradingView

The 2-hour chart shows a similar pattern, with the RSI giving even stronger bearish divergence signals and the MACD already entering negative territory. At the same time, the price formed a bearish engulfing candlestick after reaching the aforementioned top at $ 11,731.

Minor support comes at $ 11,300. Its loss may lead to a further rollback in the direction of the 0.5-0.618% Fibonacci retracement levels in the region of $ 10 894- $ 11 053.

Bitcoin Pulls Back, But Holds Above $ 11,200 Support

BTC chart. Source: TradingView

Wave analysis

It looks like Bitcoin started its heels wave (black in the chart below) on September 8th. This wave is realized in the five sub-wave form (orange), and at the moment the price is in the third sub-wave stage.

If it falls below the low of the second wave of $ 10,136, this analysis will lose its relevance. A break below the 0-2 line will also signal the end of the bullish trend.

The probable target of the third wave (orange) is located in the area of ​​the 2.21-2.61% Fibonacci retracement levels $ 12,611 – $ 13,111, while the first preliminary target of the fifth wave top is located at $ 14,000.

The following chart shows the dynamics within the third sub-wave (waves from the longest to the shortest ones are indicated in the following colors in descending order: black, orange, blue, red).

BTC chart. Source: TradingView

The third wave consists of a five-wave structure, shown in blue in the chart below. Now the price is at the stage of an insignificant third sub-wave, which looks stretched and should end in the region of $ 11,903- $ 12,230, where the levels of 2.21-2.61% of the correction are located relative to the insignificant wave 1.

If it falls below the extended third sub-wave, it will signal the completion of wave 4 (red), which fits into the short-term signs of weakening, which are signaling the technical indicators.

Bitcoin Pulls Back, But Holds Above $ 11,200 Support

BTC chart. Source: TradingView

So, Bitcoin has broken through an important resistance and after a short-term decline should resume the bullish move.

The previous analysis of bitcoin can be read here.

Disclaimer: Trading cryptocurrencies carries a high level of risk and is not suitable for all investors. The opinion expressed in this forecast does not reflect the opinion of the editorial staff of BeInCrypto.



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