Bitcoin Accelerates Fall After Pulling Back From Fibonacci Level

Bitcoin Accelerates Fall After Pulling Back From Fibonacci Level

Basic understanding of Fibonacci Retracement and how to plot against Bitcoin


Bitcoin Accelerates Fall After Pulling Back From Fibonacci Level

  • Bitcoin Pulls Back From Important Fibonacci Correction Level

  • Support takes place in the region of $ 10 115- $ 10 355

  • Technical indicators paint a mixed picture

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On September 20, the bitcoin (BTC) rate could not overcome the important Fibonacci level and fell sharply the next day. If the quotes manage to stay above the $ 10 100 mark, the chances for the resumption of the bullish move remain.

Bitcoin Accelerates Fall After Pulling Back From Fibonacci Level

Rollback from an important Fibonacci level

On September 19, the first cryptocurrency reached a high of $ 11,183, which passes near the 0.618% Fibonacci retracement level relative to the previous bullish move. The price retraced from this level and formed a bearish engulfing candle on September 22.

The fact that the BTC rate has not yet reached the descending resistance line projected from the last two lower highs suggests that the coin is in a correction mode after the recent fall..

Technical indicators paint a mixed picture. MACD began to fall, and the RSI rose above 50. At the same time, the stochastic oscillator continues to prepare for a bullish crossover.

BTC Chart by TradingView

The 6-hour charts show that the decline was preceded by significant bearish divergence signals from the RSI. In addition, MACD has lost momentum and has already entered negative territory.

BTC Chart by TradingView

Bitcoin Accelerates Fall After Pulling Back From Fibonacci Level

Bitcoin met support at the 0.618% Fibonacci retracement of the bullish move and rebounded. Levels 0.618-0.786% of the correction are in the region of $ 10 116- $ 10 344 should definitely act as a support. Otherwise, the price risks forming a decreasing minimum relative to the levels on September 4.

At the same time, there are no clear reversal signals on the charts, except for the growing MACD. A break of the line of short-term downward resistance will confirm the growth prospects of quotes. On the other hand, the loss of support could send BTC to the $ 9,700 region.

BTC Chart by TradingView

Wave analysis

Wave analysis shows that the price has completed its impulsive move and is now correcting within the A-B-C pattern (red in the chart below).

The shape of the A-B-C pattern looks unconventional, but the ratio of waves A: C is 1: 2.61, which means that the pattern is correct. However, for the completion of wave C, Bitcoin must soon reach a minimum.

Bitcoin Accelerates Fall After Pulling Back From Fibonacci Level

BTC Chart by TradingView

On the 15-minute chart, there is another bearish wave (blue), which will end with a larger wave C. In this scenario, the price will go to the 0.618-0.786% Fibonacci support area, which was mentioned above.

Then Bitcoin should go up.

BTC Chart by TradingView

Alternative Wave Analysis

There is an alternative analysis that has gained significance after yesterday’s fall. The shape and range of wave 4 (orange on the chart) raise doubts about the relevance of this analysis, but in general it still fits into the dynamics.

Alternative analysis assumes that the short-term pattern (blue) will remain unchanged, and the fifth wave will lead to a declining low relative to the September 4 level.

BTC Chart by TradingView

So, the most likely scenario for Bitcoin is a rebound in the region of $ 10 115- $ 10 355, followed by an increase.

The previous analysis of bitcoin can be read here.



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