Bitcoin (BTC) has moved up since the June 22 impact and so far has managed to hit a local high of $ 36,623 on June 29.
However, BTC has failed to regain several key levels of resistance. Furthermore, technical indicators do not suggest a bullish reversal is in sight.
BTC rebounded significantly in the week of June 21-28. It hit a low of $ 28,805 but produced a long lower wick (green). It hit a closing price above the horizontal support area of $ 32,600. This area is crucial as BTC hasn’t hit a closing price below that since the start of the year, despite some wicks breaking it.
The week end was a Hammer candlestickwhat is often seen as a bullish sign.
Despite being close above the horizontal support, the technical indicators are still falling. The MACD is bearish and negative, the RSI has fallen below 50 and the stochastic oscillator has formed a bearish cross (red symbols).
Hence, the bounce is not enough to confirm a reversal.
BTC is still trading in a range
The daily chart offers a somewhat mixed outlook. BTC appears to be trading in a range between $ 31,400 and $ 40,550. This has been the case since the first drop on May 19th. It ricocheted off the support area on June 22nd and has been moving up since then.
On the one hand, the upward movement was preceded by a very clear bullish divergence of the MACD signal line, the RSI and the stochastic oscillator.
However, none of the three are currently bullish. The MACD signal line is still negative, the RSI is below 50 and the stochastic oscillator has formed a bearish cross.
While BTC is roughly halfway to the $ 40,557 resistance area, it has declined sharply today and is about to gain an A. to accomplish bearish devouring candlestick. This would likely confirm that the trend is bearish.
The long-term wavenumber is not yet entirely clear.
While Bitcoin has clearly been in a downtrend since April 14th, it is not yet certain whether the downward movement will take place on April 22nd.
While the former suggests it has bottomed out, the latter suggests that the price could continue to decline towards $ 23,600 and possibly $ 19,800.
A closer look at the movement supports the bearish scenario.
The sustained upward movement looks like an ABC correction structure (red). There are two main reasons for this:
The overlap between upward movement and rejection (red line).
The move ended with a confluence of Fib resistance levels; the 0.618 Fib Retracement Level (black) and the 1: 1 A: C target (red).
Hence, it is more likely that BTC has not yet hit its bottom and that another downward move will follow.