Bitcoin (BTC) decreased considerably on Nov 15 and followed it up with an even sharper fall on Nov 16. It is currently attempting to find support.
BTC has been moving downwards since reaching an all-time high price of $69,000 on Nov 10. The downward movement was followed bearish divergences in both the MACD and RSI. Such occurrences often precede bearish trend reversals.
The closest support level is found at $57,850. This is the 0.382 short-term (white) Fib retracement support level. If it fails to initiate a bounce, there would be major support levels expected between $53,700 and $54,300. This would be the short-term 0.5 Fib retracement support level and the long-term 0.382 level (black). Due to the confluence of supports, this would be considered a stronger support area.
The six-hour chart is similarly bearish. It shows that BTC broke down from both the $63,500 support area and an ascending support line that had been in place since Oct 26.
The RSI is below 50 and the MACD is nearly negative (red icon), both of which are considered bearish signs.
Therefore, it aligns with the daily time frame and suggests that BTC will continue falling in the short term.
BTC wave count
The wave count shows a potential A-B-C corrective structure developing. This means that the downward movement is corrective, and the dominant trend is upwards.
If the short-term decrease is an A-B-C structure, then waves A:C would already have a 1:1 ratio. A 1:1.61 ratio, which is the second most common, would take BTC to $56,700.
The slightly longer-term count shows that it’s possible that the entire movement is contained inside an ascending parallel channel. BTC is currently just above the support line of the channel.
So, a bounce at this level would align with waves A:C having a 1:1 ratio.
If the move extends, giving them a 1:1.61 ratio, the proposed $56,700 target aligns with the 0.382 Fib retracement support level near $56,700.
For BeInCrypto’s previous Bitcoin (BTC) analysis, click here.
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