Bitcoin price has been falling since reaching a high of $ 10,491 on February 13. This decline is rapid, and it seems the A-B-C correction wave is about to end.
Highlights of BTC price
- Bitcoin may have completed the A-B-C adjustment.
- The RSI has begun to create bullish divergence.
- Price is moving in a descending support line.
- It can be traded inside the inverse head and shoulders pattern (H&S).
- There is resistance at $ 8,500.
Trader SmartContracter tweeted a Bitcoin chart, in which the price completed the A-B-C correction (Elliott wave). He suggested that the best scenario is that the price of Bitcon will trade at a range in the next few weeks, and then a breakout upwards.
– 🍄🌲Benjamin Blunts🌲🍄 (@SmartContracter) March 11, 2020
End of adjustment
Before adjusting A-B-C, BTC price could have completed a five-wave Elliott pattern. The formation began on December 17, 2019 with a low of $ 6,477 and ended on February 13, 2020 with a high of $ 10,491. Since then, prices have fallen, to complete the adjustment according to the A-B-C wave.
Using the Fib retracement tool, we can see that the Bitcoin price has dropped below the Fib 0.618 level without encountering any resistance. The next support is found at Fib 0.786 at $ 7,450.
Looking closely, we can see the price is moving in a descending support line, and the bullish divergence in the RSI.
The support line will coincide with the level of 0.786 Fib on March 13, so the price could reach a low of $ 7,450 at that time. If the movement mentioned in the tweet occurs, the price will consolidate in the range of $ 7,450- $ 8,100 (the level of 0.618) for some time.
Head and shoulders model
There is another possibility, suggesting that Bitcoin price has bottomed out and started rising. The idea was proposed by trader Dav the wave, who claimed that Bitcoin price was trading inside a long-term and short-term head and shoulders pattern (H&S).
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BTC / USD
Short term / more speculative
Something like this wouldn't surprise me – a mini reverse head and shoulders within the right shoulder of the larger one … pic.twitter.com/4BHXQtmSnh
– dave the wave (@davthewave) March 11, 2020
The long-term head and shoulders model has been proposed in the recent analysis. Therefore in this section, we will analyze only the short term.
The long-term inverse head and shoulders pattern has been placed for 177 days. Its smaller version is located entirely inside the right shoulder.
The region will determine whether the price will actually produce a small head and shoulders pattern or not found at $ 8,500. If the price rises above this level and confirms it is a support later, it will indicate that the price is creating the first part of the H&S model.
The area is then expected to act as a strong support level, to help the right shoulder be formed.
However, if the price of Bitcoin is denied at the $ 8,500 area, it is likely that the price will continue and complete the correction outlined in the first section.
The BTC price is nearing the end of the adjustment or has been done. The price response in the $ 8,500 area, such as determining whether BTC will make lower lows or start rising immediately.
You can see the price of BTC here.
Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
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