Bitcoin Technical Analysis October 6th

Bitcoin (BTC) continued its rally on October 5th, overcoming the last resistance before the September 7th high. Despite some short-term weaknesses, BTC is expected to hover above the highs.

Day outlook

Bitcoin rebounded significantly on October 5th, creating a large bullish bar.

The candlestick bar is important because it brought the price above the supertrend resistance line (red symbol). Supertrend is an indicator that is created on the basis of the absolute highs and lows of a given day and serves as a gauge for the direction of the trend. Now it has finally turned bullish (green circle) after having turned bearish since September 7th.

The next resistance is at $ 57,200. This is the 0.786 fib retracement resistance and the horizontal resistance range.

RSI and MACD are also rising.

In the case of the RSI, it has moved above 50 (green symbol) and is rising. The RSI is a momentum indicator and whether it crosses above or below 50 is an indication of an upward or downward trend. His cut over 50 on July 21 led to a sharp rally after that.

The MACD histogram has also moved into positive territory.

Hence, the trend is clearly bullish in the daily timeframe.

BTC / USDT daily chart | Source: TradingView

Future movement

The six-hour chart also suggests a bullish continuation.

First, it shows that bullish momentum accelerated as BTC broke the 0.618 fib retracement resistance and confirmed it as support (blue symbol). This means that when the price comes back down to that level, a jump is expected.

Similar to the daily time frame, all technical indicators are bullish. The RSI has just passed the 70s, which means that while Bitcoin is overbought, the trend is still bullish.

BTC / USDT 6-hour chart | Source: TradingView

Count waves

Finally, the two-hour chart shows how BTC breaks over an ascending parallel channel and then confirms it as support (green symbol).

While BTC has risen since then, the MACD is developing a bearish divergence. This means that the price rise will not be supported by bullish momentum and could result in a short-term decline.

However, this did not happen in the RSI.

When BTC falls, the channel’s resistance line acts as a support (green symbol).

BTC / USDT 2-hour chart | Source: TradingView

The most likely wavenumber would mean the move was a pullback with wave 4. This means that a correction is possible before the final move up.

In the most bearish scenario, a decline will bring the price towards the center line of the channel near $ 45,000. However, retesting the canal’s line of resistance and impact would be the more likely scenario.

The number of long-term waves is also tending to increase.

BTC / USDT 2-hour chart | Source: TradingView

You can see the Bitcoin price 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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