Bitcoin Technical Analysis February 11th
Bitcoin (BTC) has fallen after hitting a high above $45,000 on Feb. 10 and appears to be completing a corrective structure.
Shooting Star Candlestick Pattern
On February 10th, Bitcoin peaked at $45,821 before falling. The high was hit right at the 0.618 Fib retracement resistance at $44,900.
The ensuing decline created a shooting star candlestick pattern. This is generally viewed as a bearish pattern as the selling pressure created a long upper wick and a negative close.
The fact that it took place in a key resistance area adds to its importance.
BTC/USDT daily chart | Source: TradingView
Short term movement
The six-hour chart shows BTC breaking out of a previous ascending parallel channel that has been in place since Jan. 24. The price confirmed the channel’s resistance line as support on two consecutive occasions, on January 9th and February 10th (green symbol). However, the price broke this line and went back into the channel (red icon) the next day.
Technical indicators are showing some bearish signs but not confirming any downside reversal.
The MACD, formed by the short-term and long-term moving averages (MAs), is declining but still in positive territory.
The RSI, which is a momentum indicator, is also falling. However, it remains above both the 50 line and the ascending trend line formed since January 24th.
Until this level is broken, the ongoing uptrend remains intact.
BTC/USDT 6 hour chart | Source: TradingView
The two-hour chart is also showing significant weakness. This is particularly evident with the bearish divergences that have formed on the RSI and MACD. This weakness precedes the ongoing move lower.
Currently, it looks like Bitcoin is about to reconfirm the channel’s resistance line.
The main support area is located at $41,000. That target is the 0.5 Fib retracement support and the midline of the ascending parallel channel.
BTC/USDT 2 hour chart | Source: TradingView
The most likely number of long-term waves shows that BTC has bottomed out.
As for the short-term wave count, it looks like BTC is in wave four of a bullish impulse (red). The number of partial waves is shown in black.
The February 10 surge and subsequent decline suggests that the wave has taken the form of a flat corrective structure.
The partial waves A and C have by far a ratio of exactly 1:1, the most common of these structures.
The second most common ratio is 1:1.61. This will lead to a low of $41.335, which also coincides with the center line of the channel and the 0.5 Fib retracement support mentioned above.
Hourly BTC/USDT chart | Source: TradingView
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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