Bitcoin is trading above the long term support of $ 10,000.
The rebound from the September 3 crash turned out to be quite weak.
BTC has likely started wave 5 of its correction
The News Spy may have been on the rise since September 8, but it has shown considerable signs of weakness. This indicates that he is probably starting a final top-down stage, which could end at $ 9,700.
Following losses during the week of August 31 to September 7, Bitcoin’s price consolidated over the following week. Price created a small Doji candlestick above the $ 10,000 area, which has been showing resistance since February and should now provide support.
So, as long as price moves above this area, the current movement is seen as a further test of this support level.
Long-term Bitcoin support
Technical indicators are neutral, with a slight bearish tilt. The MACD started to move lower, but did not confirm a bearish close. Both the RSI and the Stochastic RSI are above 50 and show a positive slope.
The daily chart gives conflicting signals. The price has been retracing since September 8th, but its upward movement is very weak. BTC even failed in its attempt to reach the 0.382 fibonacci level of decline, located at $ 10,681.
Technical indicators are however bullish. The MACD is up, as well as the RSI is the stochastic RSI. The Stochastic RSI could also be poised to form a bullish cross.
The shorter-term, two-hour chart shows a deviation above the minor resistance zone at $ 10,400, as well as a relapse within it.
Combined with the bearish divergence in the MACD and the fact that the latter has turned negative, this suggests a possible decline in price.
On September 2, Bitcoin’s price likely started an impulsive, bearish five-wave formation. He completed wave 4 (orange below) and has now started his final decline with wave 5.
The price did not show a significant retracement and failed to reach the 0.382 fibonacci level of decline. That said, the fact that the move is perfectly contained in a parallel channel, along with the decline on September 13, suggests that the rally is likely over.
The first possible target for the end of wave 5 would be at $ 9,718, and is found at the 0.382 fibonacci level of waves 1 to 3.
Further analysis of the decline shows that the price likely completed subwaves 1 and 2 (in orange) within wave 5 mentioned above.
The current price level, near $ 10,370, shows a strong confluence with the previous rebound like decline. This would be a very plausible level for the end of the rally and a resumption of the downward movement.