Bitcoin Technical Analysis November 17th

Bitcoin (BTC) fell significantly on November 16 and is about to break below a short-term corrective pattern that could spark a deeper decline.

Day outlook

BTC has been falling since November 10th after hitting an all-time high of $ 69,000. The downward move was initiated by a bearish divergence in both the MACD and RSI. This is a bearish sign and often opens the door to a possible trend reversal.

BTC touched the initial support area at $ 57,850. This is the short term fib retracement support at 0.382.

However, there is stronger support between $ 53,700 and $ 54,350 created by the 0.382 long-term (black) and 0.5 short-term fib retracement support.

BTC / USDT daily chart | Source: TradingView

Potential problems

The six-hour chart shows that BTC is about to break below a rising parallel channel. In addition to this, it also breaks the marginal support area of ​​$ 59,800.

Previously, BTC deviated below this range on October 27th (red circle) before recovering. However, it is about to break again.

If the price drops below this support area, BTC is likely to fall towards the $ 53,700 to $ 54,350 support zone described above.

BTC / USDT 6-hour chart | Source: TradingView

Despite short-term bullish signs such as a bullish divergence in the RSI, BTC will have to rebound to the support line of the channel in order to potentially reverse into an uptrend.

BTC / USDT 2-hour chart | Source: TradingView

Count waves

The number of waves indicates that BTC is in wave C of the ABC correction structure (black). This is usually the final wave of correction. An upward movement would then be expected.

Currently, waves A and C have a 1: 1 ratio, which is the most common of these corrections. However, if the canal fails, the ratio of the waves develops to 1: 1.61, the second most common ratio.

This will bring the price towards the aforementioned support area near $ 54,350.

BTC / USDT 6-hour chart | Source: TradingView

The five-minute chart shows that yesterday’s decline looks like a correction (highlighted in red), likely part of another short-term ABC correction structure. This means that this is not the start of a new downtrend, but a correction.

Hence, BTC is likely to bounce back in the short term before falling towards the support described above.

BTC / USDT 5-Minute Chart | Source: TradingView

You can see the BTC 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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