Since BTC has traded within an ascending parallel channel after its low in June, there might be a breakout in the price. An alternate count suggests Bitcoin has completed wave four, but a final decline will occur before the price bottoms out.
The price of Bitcoin (BTC) has created a bearish weekly candlestick while giving downward signals on the daily timeframe.
After reaching its all-time high of nearly USD 69,000 in November 2021, the value of Bitcoin has not stopped dropping. In June, the bearish movement led to the local low of USD 17,622.
The price subsequently rebounded, validating support at the USD 19,300 horizontal zone, and has not stopped rising since then.
Despite reaching the local high of USD 25,211 on August 15th, Bitcoin created a bearish candlestick over the last week. That invalidated much of the gains made since its low in June.
Since the weekly RSI has maintained a descending resistance line and has not broken above 50, the trend still seems bearish.
The Daily Analysis of the Price of Bitcoin
The daily chart shows a predominantly bearish outlook, as the RSI collapsed from its ascending support line and dropped below 50. While those movements usually precede price declines, the RSI falling below 50 signals a bearish trend.
Since the price dropped below the USD 22,000 area after apparently breaking above it, that area should now provide resistance.
According to the six-hour chart, BTC has traded within an ascending parallel channel since its low on June 18th. Those channels usually contain corrective structures, implying that any breakout in the price might occur.
Bitcoin is at the bottom, which legitimizes the possibility of the price breaking out of the channel. If that happens, its price is likely to drop to new lows.
The Long-Term Wave Count of Bitcoin
According to the most likely long-term wave count, Bitcoin has completed a corrective ABC structure. In it, waves A and C had a ratio of 1:1.61, the most common in that type of structure.
Various indicators on the chain show the possibility of the price bottoming out in the long term.
The presence of the channel causes the alternate count to suggest that Bitcoin has just completed wave four. Another final decline will follow before the price bottoms out.
That will remain the alternate count until the value of Bitcoin breaks out of the channel.
Bitcoin is trading at around USD 21,195 and has accumulated a 1.3% loss over the last 24 hours. While its daily trading volume is above USD 22.27 billion, its market capitalization is about USD 405.43 billion, according to CoinGecko.
By Alexander Salazar
