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Bitcoin (BTC/USD) has been testing the previous top around $19,000 for 10 daily candles in a row. But so far, the bulls have not succeeded to break it.

Will price be able to break above the key resistance? Or is the uptrend over and ready for a reversal?

The BTC/USDs hesitation to break could indicate an extended wave 4 (pink). In that case, price action is expected to test the shallow Fibonacci retracement levels.

A bullish bounce is expected at those Fibs and support zone (blue box). This is a significant confirmation Why?

The other likely scenario is an immediate breakout above the previous top. In that case, it would be good to see a break, pullback and continuation. This pattern helps avoid false breakouts. Plus there is also a round level resistance at the $20,000 mark.

On the 4 hour chart, a break below the support trend line (green) confirms the extension of the wave 4 (pink 4). The pattern is then completing a bearish ABC pattern (purple).

A bullish breakout should see a break, pullback, and continuation pattern. Otherwise the break remains vulnerable to a deeper retracement.

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

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Bitcoin at $19,000: How to Trade the Pauze - FX Empire