On July 10, the Bitcoin price reached a high of $13,764. A rapid decrease ensued. The BTC price briefly reached lows below $11,000 the next day. After a small upward move, the price continued to decrease. On July 15, it made a low of $9880.
Since then, BTC has been increasing.
How long will this increase continue? Keep reading below in order to find out.
Bitcoin Price: Trends and Highlights for July 16
- BTC/USD just broke out from a descending wedge.
- The breakout occurred with average volume.
- There is strong resistance near $11,000.
- BTC is likely in the final subwave of an A-B-C correction.
BTC Price in a Descending Wedge
Since reaching a high on July 10, the BTC price has been trading inside the descending wedge outlined below.
On July 15, it touched the support line.
This initiated an upward move that caused the BTC price to break out from the wedge.
However, the breakout occurred with slightly above average volume, somewhat reducing its validity.
Furthermore, it failed to break out above the main resistance area created by the previous support at $11,000.
A look at the moving averages (MA) also suggests that the price has not yet begun an uptrend.
The breakout from the wedge found resistance at the 100-period MA, which had previously made a bearish cross on July 14.
Additionally, BTC is trading below both the 10- and 20-hour MAs, which seem to be turning downward.
A bearish cross would likely confirm continued downward movement for the Bitcoin price.
Also, it is worth noting that the breakout was preceded only by very slight bullish divergence in an hourly time-frame.
The divergence was not present in time-frames of two hours or more.
Future Movement
In our correction analysis, we stated that we are likely in the final/C wave of the correction.
We hypothesized that this wave will consist of five subwaves.
Price movements were outlined in the image below.
Actual price movements have followed the outlined path in a relatively accurate way.
If our analysis proves to be correct, BTC will soon continue its downward movement and finish the fifth subwave.
Long-Term Support
A look at the daily time-frame shows that the BTC price has been following an ascending support line since May 2019.
In order to complete the fifth wave outlined above, the price must break down from this support line.
However, the line has shown significant support. On July 2 and 15, the price touched the support line and immediately began an upward move.
This was particularly evident on July 2, since the price increased by over 20 percent in a span of two days.
The ensuing upward move on July 15 was smaller, and the price failed to retrace above the close of the previous day’s bearish candle.
A daily close above $11,200 would indicate that the upward move has significant strength and we are likely to go higher. It would also invalidate our previously outlined price movement.
Summary
The Bitcoin price recently broke out from a descending wedge.
The breakout did not transpire with very significant volume.
According to our analysis, it is likely that the Bitcoin price will resume its downward movement.
A price close above $11,200 would invalidate our hypothesis.