Bitcoin (BTC) Rebounds at $19,000 – Long Road to a Bullish Reversal

Bitcoin (BTC) Rebounds at ,000 – Long Road to a Bullish Reversal

Bitcoin (BTC) rose significantly on Wednesday and the initial signs of a possible upward trend reversal are showing.

BTC has been dropping since it reached a high of $25211 on August 15th. On August 26, the bearish move triggered a breakdown from an ascending parallel channel that had been in place since the June 18 low.

After the crash, Bitcoin continued to decline and reached a low of $18,510 on September 7. The decline was just below the $19,000 support area created by the June lows. However, the price bounced back soon after and reclaimed the area in the process.

Recoil ability

Technical indicator readings support the possibility of a rebound. This is evident in the daily RSI, which generated quite a bit of bullish divergence. Moreover, it rebounded before reaching the oversold territory. Such readings are often preceded by a significant price bounce.

If that happens, the nearest resistance area will be at $21,100. This is the 0.382 Fibonacci retracement resistance level and coincides with the support line of the previous channel.

BTC Wave Count Analysis

The wave count indicates that Bitcoin is in the fifth and final wave of the bearish (white) movement that started with the all-time high in November.

If true, the downward movement would take bitcoin below its June lows, and likely drop to $15,420 or $12,770. The targets were found using the 1.27 and 1.61 external Fibonacci retracement levels of the fourth wave (white).

However, the short-term count (red) shows a completed five-wave bearish movement. It is not certain whether this was the entire fifth wave of the previous image, in which case it was cut out, or if it was only the first part (black).

Either way, a significant upward movement is likely, whether it is a bounce towards the $21,200-$21,900 region or a fresh reversal to the upside.

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