23.04.202107:25 Forex Analysis & Reviews: Bitcoin tries to escape downtrend

After having studied the bitcoin chart, we can clearly see new details that lead to interesting conclusions. In this article, I will consider the possible short-term technical scenarios for BTC taking into account the dynamics of the chars.

The yesterday sideways movement in the area of 53.980,47 – 57.513,35 may be interrupted. The support level was broken and BTC hit a low before rising higher. It seems that a downtrend is emerging on the 4H chart. Notably, the last time such a downward movement ended with a collapse of 14% on the weekend.

To form a medium-term outlook, let us analyze the daily charts. We can see that the support area of 43.033,38 – 53.697,63 from February 28 was broken during Sunday's fall. All the movements of this week are formed below this level. This means that there is a high probability of a deeper downward correction.

On the daily chart, the flag pattern is clearly visible. It was formed by a bearish candlestick. The flag is a continuation of the trend. Quite often they follow each other on the chart. The next level may be the height of the flag handle.

Thus, BTC may drop to $45,000 or even lower to the previous historical high of January 8. BTC is already heading to $42,000 per coin.

However, flags are rarely formed in two, but there are signals for a further fall in bitcoin. That is, the correction may be deeper than even Sunday's lows. According to the classic triangle trading, the signal is considered to be a breakdown of the lower border of the flag. This is a strong mirror level of 61.8 on Fibo Expansion near $52,000 per coin. So, if it consolidates below this level, it may be a double bearish signal.

On the 4H chart, we can see that within the descending channel (the flag canvas) 57.605,23 – 57.093,49 – 53.404,97, there is a likelihood of recovery. The downtrend will be confirmed if the price bounces down from the third point of its resistance line. Therefore, it is necessary to wait to be certain that the technical analysis is correct.

If the technical analysis turns out to be true, BTCUSD may decline again. In this case, we will need to monitor the breakdown of the lower border of the flag canvas.

It is possible that new patterns will lead to the revision of the forecast and the cancellation of the bearish scenario. Yet, currently, there is not enough data for this.