Bitcoin (BTC) Rebounds, Aims to Reclaim $51,000
continues its uptrend and reclaimed its 200-day moving average (MA) yesterday. If the trend continues, it could lead to the long-term resistance area at $51,000.
Looking further out, a Wyckoff distribution pattern is possible, which would take BTC to the support area at $37,300.
Bitcoin rebounds
After printing a gravestone doji candlestick on Aug 18, BTC rose almost 5% to close at $46,765. On Aug 20, BTC continued on its upward trajectory and is attempting to break through the previous peak at $48,150 from Aug 14. Yesterday’s increases led to a reclamation of the 200-day moving average, around which BTC has been oscillating for almost two weeks.
Moreover, BTC bounced off the short-term support area at $44,000, which is paired with the weekly S1 support. Currently, bitcoin is above the weekly pivot at $45,973. As long as it stays above this level, the short-term sentiment should be considered bullish.
The first area of support is at $42,600, which coincides with S2 weekly support. If lost, the next important area is around $37,300, where BTC printed a higher low on the daily time frame.
Moreover, the falling volume signature suggests a decline in volatility. Also, the BBWP is dropping and is currently below the value of 50. This situation could lead to a sharp move – up or down – on the BTC market in the last days of August.
Technical indicators support the bullish outlook. RSI has returned from the neutral territory and is heading upwards. MACD, after forming several small bars of negative momentum, is close to regaining bullish dynamics. The Stochastic oscillator has formed a bullish cross and is returning to the bullish territory.
Rising channel and resistance at $51,000
The four-hour chart shows a rising parallel channel that has been in place since the macro bottom of July 20. Yesterday, BTC bounced off the bottom of this channel and moved upwards. The nearest target is the median, which will be at the $51,000 area in a few days.
The $51,000 area corresponds with the long-term 0.618 Fib retracement level measured for the entire downward move, as well as with the weekly R3 resistance level. Thus, it will form an important resistance area where increased selling pressure can be expected.
Another Wyckoff distribution?
Cryptocurrency trader @CryptoCapo_ tweeted two Bitcoin charts that suggest a possible repeat of the Wyckoff distribution fractal. The pattern played out as bitcoin set an all-time high at $64,854 between February and May 2021.
Capo notes the possibility of a repeat of the same scenario in a lower time frame. On the 12-hour chart, we can see a rising BTC price as the RSI is falling, creating a hidden bullish divergence (blue lines).
According to @CryptoCapo_, this could lead to one more upward move to the area around $51,000, followed by a decline below $38,000. Both of these levels are in confluence with the long-term resistance and support areas discussed above.
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