Bitcoin (BTC) like most cryptocurrencies during a period of strong growth at the end of last autumn set new all-time highs. On November 10 to be exact, its price reached $69,000. After setting another record on the daily chart, a downward divergence appeared on the MACD and the price began to fall dynamically.
Formations known from technical analysis and price action so far did not work very well and analyzing the BTC chart was quite imprecise. However, something recently caught my attention on the D1 chart. I noticed that subsequent bearish divergences quite accurately predicted declines.
When we turn to the H4 chart, here too we can conclude that the recent upward divergence “pushed” the price of BTC from the level of 17700 to 21800 USD.
Moreover, the chart has drawn an inverted head and shoulders formation and the neckline was overcome on Friday. MACD is still in an upward phase.
Is this a signal for an upward correction and can we expect that the “winter” on cryptocurrencies is coming to an end? I would not be so optimistic, but it seems that a small upward correction is quite possible. Its range is the minimum from May, i.e. around USD 25200. However, if the downward trend continues, the closest support is the last minimum at 17700 USD and then…10200 USD.
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The above analysis is based on the PA+MACD strategy, a detailed description of which you can read HERE . I will talk more about the PA+MACD strategy applied to these currency pairs during the live trading sessions which you can attend from Monday to Friday.
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