Bitcoin price stopped in the range $6000-6300.
After breaking through $6000, the probable point of a local reversal is $5844.
Continuation of the fall is possible after the test of the range $6300-6430.
Yesterday’s trading day on Bitcoin market was at temporary price stop in the range $6000-6300. After a sharp fall of Bitcoin price from $6830, buyers are able to slow down its aggressive down movement. However, looking at the depth of the correction of the previous fall wave, in the current range, buyers are not feeling strong.
Therefore, the continuation of the fall wave to approximately the lower limit of global consolidation $5700-6830 is quite real. At the 4-hour timeframe, we see a situation where sellers were trying to break through $6000. As a result, a large pin down which should be signal for a local price reversal, was formed. However, the next 4-hour candle closed extremely passively and on catastrophically small volumes. It indicates that it was not a counterattack but a passive defense. This type of situation usually leads to a passive but confident price lowering with a break of a key local level.
On the hourly timeframe it is possible to notice the likely formation of reversal figure “head and shoulders”. Although the nature of the current fall shows that there are not enough buyers in Bitcoin market to form “right shoulder” and break the mark $6300. That’s why, our main scenario of Bitcoin price fall continuation remains valid. The critical range for sellers remains $6300-6430.
The situation with the marginal positions of market participants remains unchanged:
Buyers continue to decrease their margins, but not so sharply, and sellers with confidence increase them.
Yesterday’s candle didn’t close well for sellers:
As you can see, most of the candle consists of a pin, which can signal the local end of the fall in Bitcoin market. The unsuccessful closing of yesterday’s candle did not upset sellers, who continue to push the price down today. At the moment, it is important to understand whether the beginning of a new trend of growth will be a correction of the current fall or an impulsefor a new wave of growth.
According to the wave analysis, in our opinion we should expect a correction in the range $6300-6430. After which, we should expect the continuation a 3-wave correction forming with a minimum target $5510:
Let’s see how traders will close the weekly candle and tomorrow we forecast the Bitcoin price movement for the next week.
Image Courtesy: TradingView