A sharp price lowering to $6,910 was a false breakdown.
Sellers were unable to update the local low, thereby giving the initiative to buyers.
In case of Bitcoin price fixing above $7,365, the following local targets are $7,690 and $8,200.
The trading day on Bitcoin market was quite saturated today. Breaking the local level in the price mark $7,110, which was formed on 19 December, sellers quickly managed to lower Bitcoin price up to $6,900. However, to continue falling with the target of $6,600, which we wrote about in the previous analysis, was not destined for sellers, as all of this turned out to be a false breakdown.
Some sellers increased their marginal positions confidently and some buyers were forced to close their positions at a loss. Because, buyers relied on the critical point which was broken. Although, this false breakthrough gave impulse to buyers. They may have been expecting a price fall to enter the position. So, now we are already observing a very promising attack of buyers on the breakdown of the critical price range of $7,550-7,800.
Today, Bitcoin price has grown by almost 8%. Of course, it is not an impressive result for those who know the volatility of the crypto market. However, being in consolidation is a pretty good result.
In this way, sellers were unable to update the local low and pushed the idea of creating a certain Bitcoin price growth channel:
As we see, buyers managed to go through the main local consolidation $7,110-7,250, where Bitcoin price spent a lot of time. And now they are successfully fixing above it.
On the daily timeframe we see that buyers take initiatives in the form of absorption of yesterday’s daily candle:
We’ll see if buyers can break through the yellow range, but definitely they should test it.
An interesting fact is that there was no panic in the chart of buyers’ marginal positions during the test of $6,910:
Namely, after two powerful growth candles, during the consolidation of price in the range $7,350-7,400, buyers actively began to increase their marginal positions.
Sellers who enter the position at the breakthrough of the local mark $7,100 were paid and were forced to close their positions during a sharp growth of Bitcoin price:
According to the wave analysis, now the wave (c) is forming. If buyers successfully pass Fibonacci level 0.382 at the price $7,365, the following local targets of buyers will be $7,690 and $8,200.
Let’s see if the situation changes on the weekend and whether buyers will be able to test $7,550-7,800 by the beginning of the new week.
Image Courtesy: TradingView