Bitcoin (BTC) has likely completed a correction with a breakout across the medium and short-term pattern.

Day outlook

BTC has been stuck below a descending resistance line since hitting an all-time high in November.

Between December 4th and 19th, both the RSI and the MACD produced significant bullish divergences (green line). This is a bullish sign that often precedes a trend reversal as it means the price decline has not been accompanied by a decrease in momentum.

After completing the bullish divergence, BTC initiated an upward move and broke the descending resistance line in December.

The closest resistance is between $ 55,500 and $ 58,700. This target area is created by the 0.5-0.618 Fib resistance range.

BTC / USDT daily chart | Source: TradingView

Short term outbreak

The two-hour chart shows that BTC is breaking over a short-term descending parallel channel that has existed since December 7th. This is another sign that the correction phase is complete.

Currently, the closest resistance is at $ 50,600. If BTC breaks this level, it will likely accelerate towards the resistance area described above.

BTC / USDT 6-hour chart | Source: TradingView

Count waves

The short-term wave count shows that BTC has completed a complex corrective structure (highlighted) and is currently recovering.

If the W: Y wave is 1: 1, which is common with such corrections, the BTC-THFI can hit a high of $ 55,500, which is in line with the resistance area outlined above.

BTC / USDT 2-hour chart | Source: TradingView

In the long term, it is still uncertain whether the current upward movement is wave B (black). If so, BTC will have one more drop to complete wave C.

The price reaction to the spike of wave B will help determine the direction of the long-term trend.

BTC / USDT 6-hour 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.

SN_Nour

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