Bitcoin rallied aggressively today and recovered from the massive drop. Price is trading in the green on the Daily chart, but remains to see what will happen in the upcoming days as the rate is trading below some very important resistance levels (support has turned into resistance). I’ve said in the last days that the price could drop again after the last week’s impressive increase as the rate has shown the first exhaustion signs.
However, the current drop may be only temporary, the corrective phase could already be completed and could try to climb much higher again.
The rate has dropped sharply in the last three day and it was almost to reach the upper median line (UML) of the ascending pitchfork and the second warning line (wl2) of the descending pitchfork. We have an important confluence area formed between these two levels, but the rate failed to reach it, signaling that the bears are weak again. Bitcoin closed much above the upper median line (uml) of the ascending pitchfork and has managed to erase the last two day’s losses. Is trading above the first warning line (WL1) of the ascending pitchfork, it could retest this level before will climb much higher. Personally, I’m expecting to see a minor sideways movement before the rate will recapture more directional energy and will start to increase again.
Remains to see if the rate will really have enough energy to reach the 7772 historical high, the perspective remains bullish despite the current drop. I’ve said in the last week that the rate could drop after the Monday’s spike and after the failure to close near the WL3 and near the fifth warning line (wl5) of the minor descending pitchfork.