Bitcoin Dominance (BTCD) is recovering from long-term support

Bitcoin Dominance (BTCD) has double bottomed in the long-term support area of ​​39.50%.

Despite breaking the descending resistance line, it has yet to cross an important area of ​​resistance where the trend is confirmed as bullish.

Long-term double floor

BTCD has been in decline since the beginning of the year. This resulted in a low of 39.66% on May 19.

After a slightly bullish session, it fell back to the 39.50% support area in early September, creating a double bottom that was accompanied by bullish divergences in both the RSI and the MACD.

The double floor is also considered a bullish pattern. An upward movement should therefore follow.

BTCD weekly chart | Source: Tradingview

BTCD outbreak

The daily chart shows that BTCD is breaking above the descending resistance level that has existed since July 30th.

The breakout was supported somewhat by RSI and MACD. While both are bullish, the former is still below 50 and the latter is in negative territory.

There is a very strong resistance at 44.5%. This level is created by the 0.5 fib retracement resistance, the supertrend line (bearish) and the horizontal resistance area.

Hence, the trend cannot be considered bullish until the price enters this zone.

BTCD daily chart | Source: Tradingview

Count waves

The most likely wavenumber indicates that BTCD is on the fifth and final wave of a bearish pulse (orange).

The most likely target for the downtrend is the 33.89% – 35.85% zone. It was found by the length of the first wave (orange) and the 1.61 retracement FIb level outside of the fourth wave (black). This will lead to a new all-time low.

BTCD daily chart | Source: Tradingview

The near-term outlook suggests that BTCD is likely to be in the final sub-wave of wave 5. Hence, it is expected to bottom out soon and begin a significant uptrend after that.

BTCD 6-hour chart | Source: Tradingview

You can see the coin prices here.

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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

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