Bitcoin (BTC) holds support after steep decline

Bitcoin

(BTC) has recovered from a sharp decline on September 7. It rebounded after reaching the support area at $44,000 the following day. Sponsored

Despite the short-term bounce, long-term indicators are beginning to warn of a potential bearish reversal.

The ongoing rebound of BTC

Bitcoin fell sharply on September 7, after reaching a local peak at $52,920. The bearish price movement caused it to fall to a low at $42,483. However, a strong rebound occurred on the same day, forming a very long lower wick (green).

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The decline validated the horizontal area at $44,000 and the supertrend line (green) as support

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Although bitcoin has rebounded, technical indicators are decidedly bearish. MACD has fallen into negative territory and RSI

is below 50 (red icon). The latter’s move above 50 was the signal for the entire upward move that began on July 20.

Therefore, while the price action looks bullish, still showing a potential bullish retest, the technical indicators remain bearish.

Bitcoin (BTC) holds support after steep declineDzienny wykres Bitcoin BTC chart via Tradingview

Future movement

The 2-hour chart is currently showing signs of a short-term reversal. MACD has given a bullish reversal signal and RSI is moving up after generating a bullish divergence.

If the bounce continues, the nearest resistance area is likely to be between $47,850 and $49,050. These targets represent resistance levels at 0.5-0.618 Fib retracements measured for the entire downward move.

Bitcoin (BTC) holds support after steep declineBitcoin (BTC) holds support after steep declineBTC chart via Tradingview

Wave count

Due to the

sharp decline and rebound, we can use a line chart to get an idea of the short-term wave count.

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The short-term scenario suggests that Bitcoin has completed wave three and is now correcting upwards inside wave four.

This move will likely take BTC towards the aforementioned resistance area in the $47,850 – $49,050 range.

Bitcoin (BTC) holds support after steep decline <img src=”https://yellowrocketagency.com/wp-content/uploads/2021/09/BTCUSD_2021-09-09_08-50-03..png” alt=” width=”1561″ height=”826″ />BTC chartcourtesy of Tradingview

In the longer term, this would complete wave A of the A-B-C corrective structure.

While the exact bottom of wave C cannot yet be determined, both the bearish and bullish long term wave numbers indicate that a short-term decline should occur first.

Bitcoin (BTC) holds support after steep declineLiczba fal Bitcoin BTC Chart via Tradingview

For a previous analysis of Bitcoin (BTC) via BeInCrypto, click here

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