Cryptheory

24/7 crypto news, cryptocurrency meaning, guides, learning, #cryptohelpschildren

BTC analysis – how to correctly interpret the reversal of the current correction?

1 min read

BTC creates a correction leg in the short and long term. The last maximum was respected by MA21 and the price is falling again. Volumes remain minimal and the price does not yet indicate a turnaround trend. Nevertheless, the correction weakens and slows down. But when can it end definitively and what needs to be identified when the trend changes?

BTC generated a short-term high of $ 43,250, which caused MA21 to be tested at period 4H as resistance. Subsequently, the price entered a slight decline. In the short term, the price can go to the sideway structure, similar to between September 7 and 13. Support level is worth $ 41,000 and $ 38,000.

BTC / USD 4H.  Source: TradingView
BTC / USD 4H. Source: TradingView

BTC trend reversal

However, if we want to identify trend reversal, we must observe the position of the minimums and maximums. The last short-term lows had an increasing tendency, which creates the potential for the formation of a reverse pattern 123 bottom formation. However, this pattern is valid only when the maximum is divided between the minimum. The price would have to overcome the resistance of $ 45,150. However, he is not going there yet.

In addition, with the 123 bottom formation pattern, the volumes need to increase as the legions grow. Volumes should not show higher values ​​when corrected compared to increasing volumes. However, this is not happening on the graph either. The price thus continues to correct and does not point to a reversal of the trend in the short term.

All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

Leave a Reply

Your email address will not be published.