This pair is in a bullish trend since price has been trading above the moving averages for some time now. It is also worth noting that the last impulse wave was started when price kept making lower lows on diminishing volumes at points A,B,C. Currently, price is retracing.
This corrective phase started when price was making higher highs on diminishing volume between points D and E showing lack of demand from the smart money. At points F, we have a large spread high volume down bar closing in the middle which was immediately tested at point G with smaller spread and lower volume. Price then went up on reducing volumes bouncing off the support area marked with blue and 2 horizontal lines on the chart. Notice a probable demand level below this support area. A trend following system would have signal a buy here.
BTCUSD Daily Chart
Let us switch to the 4hr timeframe to analyze further
BtcUsd 4hr before…This following MACD divergence appeared on the 4hr chart to give a warning sign that the correction might be at an end. This was shown in an earlier analysis. This point was buttressed by the disinterest shown by the bears in further selling. At point A, B, C volume shows that supply is drying up in the market as volume kept reducing whenever price makes a new low.
Now, the level 51335.28 has been retested two times at points X and Y with diminishing volume each time. This explains the subsequent pullback into the trading range. This also give us an expectation of higher volume (absorption volume) bar should price tries to break above this resistance level later at 51335.28.
Here, notice that the structure is an inverted head and shoulder pattern following a structure break.