Bitcoin (BTC) recovers after rejection from $50,000

Bitcoin

(BTC) rose to the $50,500 level on August 23, but was rejected before reaching the resistance area at $51,200. Sponsored Sponsored

While bitcoin continues to follow an ascending support line, it is possible that it has reached a local top.

Evening star near resistance

Bitcoin has been moving upward since July 20, and it peaked at $50,500 on August 23. However, it formed a long upper wick the next day and ended the evening star formation.

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This peak was reached very close to the resistance area at $51,200, which is the resistance level at the 0.618 Fib retracement and the horizontal resistance area.

Moreover, the decline was preceded by bearish divergence on both RSI and MACD

. The latter is even showing signs of a bearish reversal. Bitcoin (BTC) recovers after rejection from $50,000Wykres dzienny Bitcoin BTC chart thanks to Tradingview

Future movement of BTC

On the 6-hour chart, we see similar divergence on MACD and RSI

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Additionally, we see a rising support line that has been holding since the aforementioned July 20 low. BTC is currently trading just above this line.

A break from this support could trigger a sharp decline towards the next closest support level at $42,371. This level is both a horizontal support area and a support level at the 0.382 Fib retracement.

Bitcoin (BTC) recovers after rejection from $50,000Bitcoin (BTC) recovers after rejection from $50,000 BTC chart courtesy of Tradingview

Wave

count As outlined in the BeInCrypto article on Bitcoin

‘s

long-term wave count from August 24, the wave pattern is not entirely clear. However, there are two likely scenarios. One assumes that BTC has completed wave three. In the other, BTC has already completed an A-B-C corrective structure.

If wave three (orange) has completed, then a sharp short-term decline would be the most likely scenario. This is due to the concept of alternation, as wave two was gradual and extended.

Bitcoin (BTC) recovers after rejection from $50,000 <img src=”https://yellowrocketagency.com/wp-content/uploads/2021/08/BTCUSD_2021-08-25_09-16-18..png” alt=” width=”1813″ height=”826″ />BTC chartcourtesy of Tradingview On the

other hand, a completed A-B-C correction

would lead to a similar short-term decline. However, its consequence would also be a long-term decline towards new lows.

Therefore, both scenarios suggest a decline in BTC in the short term.

Bitcoin (BTC) recovers after rejection from $50,000Liczba fal dla Bitcoin BTC chart courtesy of Tradingview

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

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