What is Bitcoin (BTC) Doing Right Now?
Bitcoin is currently trading around the $43,000 mark and is looking quite bearish in the immediate short term. Our previous analysis mentioned that Bitcoin could face rejection at the $43,000 or $44,000 level. The scenario is still in play, and if it does pan out, we will be heading towards the $39,000 level next.
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Analyzing the Charts
Bitcoin is showing several bearish indications at the moment, but that does not necessarily mean we are heading towards a major sell-off. There is a decent probability that we will get to the $38,000 level, but we could also bounce back from there strongly.
Currently, Bitcoin is forming a very bullish pattern on the 4-hour and 1-day timeframe, which shows we are not in a free-fall anymore.
This descending wedge is telling us that the price is being squeezed towards the downside, and Bitcoin is still bullish in the midterm. We can also see we had a nice bounce back from the bottom of the wedge, which tells us our structure is holding well.
If we do break out of this falling wedge in the coming weeks, the area we will be eying next for Bitcoin is the region around $55,000.
On the other hand, if we see another sell-off and manage to break below the wedge, we will become bearish on Bitcoin. If BTC manages to close 2-3 candles below it on the 4-hour timeframe, we could see a similar sell-off we experienced in May earlier this year.
The area we would want to hold in case of a sell-off is the $34,000 level. This level has acted as both support and resistance in the past.
Conclusion: What is Next for Bitcoin (BTC)?
Even though we are forming a nice bullish pattern, Bitcoin is still looking bearish in the immediate short term. Right now, we would only be looking for short positions around our resistance levels as the selling pressure is higher. We would still not be placing any long trades on Bitcoin until it shows some nice bullish momentum.
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