Bitcoin broke through above $ 7000, but it’s too early to rejoice
Bitcoin’s path to the north is blocked by numerous resistance levels, including MA and Fibo levels..
The price has reached lines resistance of the rising wedge pattern.
Long-term resistance and support are located at $ 8000 and $ 6000, respectively.
Bitcoin found a bottom at $ 3,782 on March 13 and has strengthened since then. On graphics a “rising wedge” has formed, which considered bearish reversal pattern.
After reaching the above grounds, bitcoin rate (BTC) rose nearly by 90%. However, all of this increase still pales in comparison with the scale of the previous decline, believes cryptocurrency trader and analyst Walter Wyckoff (@Walter_Wyckoff).
On the chart, which he shared in Twitter, he matched the current growth BTC and him previous decline. He also plotted a number of resistance levels on which he is going to sell. bitcoin, if the price reaches these levels. He singled out the key resistance at $ 7,600, but at this he believes that the very long upper candle wick can toss up MTC in district $ 8100- $ 8300.
Technically short are would be 7.6k, but this is $ BTC, so I would not be shocked by some scam wyck reaching 8.1 / 8.3 k. Blind shorts there, alert at 7.6k, will short the breakdown if my blind asks don’t get filled. The pattern is very corrective till now, textbook corrective pic.twitter.com/ hwNgJHm647
– Walter Wyckoff (@walter_wyckoff) April 6, 2020
Bitcoin started new growth phase or is it just being corrected? Will it hit the $ 7,600 area? Let’s try to figure it out.
First, the price needs to break through the resistance represented by the previous long upper wick from April 2, which also coincides with the 0.618 Fib level of the retracement Total decline.
Further, strong resistance is located at $ 7,600, as mentioned in the tweet. Previously this area played the role of both resistance and support alternately. Also here is the 50-day moving average (MA).
The next resistance is at $ 8200, which coincides with the 200-day MA. 50 and 200-day MA already formed a bearish crossover. Therefore, even if BTC breaks the current resistance level, the potential for further growth seems limited due to the numerous levels located above.
After Togo how bitcoin formed the minimum on March 13, it traded inside a pattern that is probably a rising wedge. Now the price is approaching the border of this pattern, the formation of which should be completed no later than April 9.
It is noteworthy that as the wedge developed, the trading volumes decreased, which is very typical for of this pattern. The trading volumes accompanying the current bullish engulfing candle are also extremely small. it can be regarded as a bearish signal indicating weakness buyers.
The wedge resistance line also coincides with the area where the described us higher resistance levels. This suggests that ultimately price will make a bearish breakout of the wedge pattern and target support in areas $ 5900.
So way, course BTC is trading within the rising wedge pattern and we expect a bearish breakout of this pattern. Even if the price continues to rise, its upside potential appears to be limited due to several resistance levels located directly over current price levels. Topics time there is no significant support in the southern part of the chart up to $ 6000.
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