Crypto Daily: Bitcoin fell out of the wedge

Aug 27, 2021
11:08
2 min reading

Choise.com team

Only 5 cryptocurrencies from the Top-100 showed a positive result over the past day.

Let’s take a look at the chart of the first cryptocurrency and try to figure out if this fall will continue:

The $50,000 level is an insurmountable obstacle at the moment. Buyers tried to bring the price back to this level yesterday but failed. The price reached $49,300 and rolled back down. Moreover, it was a rather sharp drop and Bitcoin dropped below $47,000 again.

It is important to note that after this decline we saw almost no reaction from buyers. Japanese candlesticks on the 4-hour timeframe show this. They have virtually no bodies, and shadows are also small. This indicates a lack of buyer interest at this level. Apparently, they want to buy Bitcoin back even lower.

For the last 3 weeks, the chart has been moving within the rising wedge. This is a reversal pattern. As a result of yesterday’s fall, the price dropped below the lower boundary of the pattern and consolidated here. Perhaps the price will still show a slight increase to $ 48,000 and will retest the lower border. After that, there is a high probability of a strong downward movement to the range of $43,000 – $44,000.

If we analyze the news background, it becomes clear that all the growth that took place during last week occurred by inertia. There was no strong news that could affect the price of Bitcoin and renew interest in the crypto market. The absence of a strong news background causes a decline at the moment.

This decline is likely to be only corrective and may last for several weeks. This development of events looks optimal for the entire crypto market since Bitcoin only grew for the last 5 weeks and practically did not roll back down. The upcoming correction will help unload the chart and provide excellent entry points for the medium term.

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