Over the last 3 Days, Bitcoin has dropped around $1,000 forming a tight descending channel. Bears are struggling to gain any momentum as price levels toy with key support around $9,850 as mentioned in my previous analysis.
Bitcoin Hourly Chart
On the 1 hour chart, we can see the newly formed descending channel as a result of the recent move from $11,000 down to around $9,900 just above key support at $9,850. POC (Point of Control) still sits back at $10,600 on the hourly, indicating no real bearish momentum has built up in this recent pull-back.
MACD has also been fairly lifeless during this downturn with no wild jumps or drops when compared to MACD’s activity throughout mid-July. Typically, such a narrow descending channel is very bullish, similar to the falling wedge. This is now the 2nd descending channel that has formed on my chart above, which compared with the current bullish trend on BTC, paints a bullish picture for the days and weeks to come.
Despite the bullish sentiment, if Bitcoin price levels break key support between $9,800 and $9,400 it’s likely to price levels will continue to drop too low $8,000’s. I will also be keeping a close eye on how altcoins act to gauge sensible trades and entries, as stated in more detail within my previous analysis.
On the 2 hour chart, we can see both of the descending channels more clearly. If RSI proceeds upwards from its current level this will be a higher high accompanied by lower lows for BTC’s volume displaying potential bullish divergence.
Key resistance levels to look out for if Bitcoin price levels break upwards accompanied by a large volume spike are $10,450,