Bitcoin (BTC) created a bullish candlestick on Feb 23 and is now approaching a decisive resistance level.
BTC rose considerably on Feb 23, bouncing around the $36,600 horizontal support area (green icon). The area has acted as support since the start of the upward move on January 24th.
However, the price narrowly failed to create a bullish candlestick as the close of the closing price was only slightly lower than the previous open.
The next macro resistance is found at $44,200.
BTC continuous bounce
The six-hour chart shows that the main resistance area is located at $40,050, created by the 0.382 Fib retracement resistance level.
Furthermore, the resistance corresponds to the midline of a descending parallel channel, from which BTC broke on February 15th.
This possibility is further supported by the two-hour chart, which shows that BTC broke out of a descending resistance line after generating significant bullish divergence.
As a result, an upward move to $40,050 appears to be the most likely scenario.
Wave count analysis
There are two likely possibilities for long-term Bitcoin counting.
Likewise, there are two main possibilities for short-term counting. Whatever happens will also likely determine the long-term trend.
The first scenario suggests that BTC has completed an ABC corrective framework.
Therefore, an upward move to $49,350 would be expected. This target is found by projecting the height of the previous increase.
The second scenario suggests that the ongoing decline is part of a bearish impulse. In this case, the price is correcting within wave four before another dip.
Whether or not BTC manages to breach the February 14 low at $41,575 (red line) will be crucial in determining which of the counts is most likely to happen.
For BeInCrypto’s previous Bitcoin (BTC) review, click here
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