Bitcoin prepares for bearish triangle or zigzag pullback
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BTC/USD is expected to stay in a corrective mode for a little longer - either deep towards the Fibonacci retracement levels or shallow via an ABCDE contracting triangle.
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Bitcoin (BTC/USD) is showing two lower highs and higher lows. This indicates a bearish correction within the strong uptrend.
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A contracting triangle chart pattern seems to have the best papers at the moment. Let’s review the path of least resistance.
Price Charts and Technical Analysis
The BTC/USD is expected to stay in a corrective mode for a little longer. But once the correction is completed - either deep towards the Fibonacci retracement levels or shallow via an ABCDE contracting triangle - then the uptrend should resume and aim at the $50,000 target.
The BTC/USD is now building an ABC correction (pink) - ABC flat (sideways) or ABC zigzag (deep correction). This can expand into an ABCDE triangle chart pattern as well:
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A triangle chart pattern is more likely if price action bounces (blue arrows) at the 144 ema and previous wave A bottom.
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A break of the bottom could indicate an ABC zigzag instead (wave C’ pink).
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A wave 4 (purple) correction is expected as long as price action does not break below the 78.6% Fib (yellow circle).
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A bullish trend continuation is expected either after breaking the resistance (green arrows) and showing a bull flag (grey arrows) or after the ABCDE is completed.
On the 1 hour chart, we can see how the correction is unfolding.
An ABC correction (grey) completed wave B (pink) at the 78.6% Fibonacci retracement level. Now another ABC (grey) is taking place within wave C (pink).
The main criteria will be the breakout above the resistance (orange) or below the support (green) trend lines.
The analysis has been done with the ecs.SWAT method and ebook.
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