Bitcoin Drops Below $ 50,000; will its decline continue?

Bitcoin’s price has dropped below $ 50,000.

There is a support zone between $ 45,300 and $ 48,400.

BTC is probably correcting within a wave four.

Bitcoin’s (BTC) price fell significantly on February 22, hitting a local low of $ 47,622. Although it has since rebounded slightly, BTC is still struggling to break through the $ 50,000 mark.

Despite this considerable drop, it is likely to be a short-term correction. Then Bitcoin is expected to rise to a new high.

Bitcoin is looking for support

Bitcoin’s price declined significantly on February 22, dropping to a low of $ 47,662. It quickly came back up, creating a long, lower strand. That said, BTC then resumed its descent on February 23, dropping below its low from the previous day.

Technical indicators are showing some weakness as evidenced by the lower momentum of the MACD and the crossing of the RSI below 70. These signals are not necessarily sufficient to confirm a bearish reversal in the trend. Depending on the price at the time of the day’s close, the RSI is likely to generate some form of hidden bullish divergence, a common sign that the trend is continuing.

The six-hour chart shows that BTC has touched the 0.382 fibonacci retracement level, located at $ 48,422. There is also support at $ 45,355 (fibonacco 0.5 retracement level).

After spending 25 days above the 50 line, the RSI finally fell below the latter. This could be a sign of a trend reversal, as it was on January 10, 2021.

The two hour chart shows signs of a bullish reversal in the form of bullish divergences in the RSI, and a very long bullish hammer candlestick (green arrow).

Until BTC breaks through the descending short-term resistance line, the short-term correction cannot be considered complete

The wave count suggests that BTC is in the corrective fourth wave (in orange) of a bullish impulse started with the January 28 low at $ 29,000. Once this move is over, we expect another high near $ 60,000 .

The sub-wave count is shown in black and suggests that BTC has either completed the sub-wave or is approaching the end of it. This is because the price has already reached the fibonacci support of 0.382.

While it is possible that BTC will continue to decline directly towards the fibonacci 0.5 support, it should rebound soon and complete sub-wave B first.

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