Bitcoin (BTC): an important indicator has broken the 721-day trend line

Bitcoin (BTC) has broken out of a long-term descending resistance line bullishly, while confirming bullish RSI signals After Bitcoin hit its all-time high of $69,000 in November 2021, technical analysis shows that it has been declining along a descending resistance line.. BTC bullishly broke this line in October 2022 and tested it as support the following month (green badge). After that, the coin strengthened. It formed a massive bullish candle last week.. If the growth continues, the next horizontal resistance will come into play in the $24,300 area, and the nearest Fibo level is at $35,780. However, what is happening with the RSI seems to be much more interesting than the price dynamics of BTC now. Since the beginning of 2021, this indicator has also been declining along the descending resistance line.. The divergence from this line set the start for the entire decline in the current bear market. However, since July 2022, the index began to give bullish divergence signals (green line). Last week, a bullish candle appeared on the chart, which allowed the RSI index to make a bullish breakout of the bearish trend line, which has persisted for 721 days.. In addition, this break confirmed the bullish divergence. Thus, the weekly timeframe paints an extremely bullish picture.. Only closing the week below $17,000 will be able to color it in bearish tones. Source: TradingView BTC in 2023: Relief Rally or New Bull Run There are three potential wave scenarios for Bitcoin. All three promise price growth in the short term. As part of the most likely scenario, BTC has completed the formation of a five-wave bearish structure, which represents the first part of a long-term correction.. The price of the beginning of the growth of ABC (black), which may end near the Fibo 0.5 correction level in the area of the average price of $42,150. After that, a new decline should be expected. We consider this forecast to be the most probable, since the length of all waves seems to be proportional to each other, and wave 4 has acquired the shape of a triangle (white color). A depreciation of BTC below a minimum of $15,558 will cancel this scenario, outlining the prospects of a bearish trend in front of the price. Source: TradingView According to the second scenario, the correction has already been completed. In this case, Bitcoin has formed a WXYXZ complex structure and has now launched a new bullish move that could eventually lead the price to new all-time highs.. It also means that the market has already bottomed out. However, wave Z is doubtful here, which is too short compared to waves W and Y.. However, the logarithmic plot does not reflect this problem.. This forecast will also be canceled in case of a breakdown of the $15,558 level.. Source: TradingView As for the last scenario, it suggests that BTC is still in wave 4. The most likely bullish target and wave top could be the area just above the August 2022 highs around $25,000. The problem with this forecast is that wave 4 is too long compared to wave 2 (more than three times), which is very uncharacteristic (white). The bitcoin outlook for 2023 is not bullish only under this third scenario. Source: TradingView Conclusions: bullish outlook outweighs BTC price action therefore looks bullish due to weekly RSI (bullish divergence and bearish trend line breakout). The results of the wave analysis offer three possible scenarios, but they all promise growth for bitcoin, at least in the short term.. A price drawdown below $15,558 will neutralize the bullish outlook. Earlier, the editors of BeInCrypto discussed whether the sharp rise in the price of Bitcoin (BTC) can be considered the beginning of a bullish trend, and also analyzed an on-chain indicator that potentially signals the beginning of a bull market for Bitcoin. Disclaimer All information contained on our website is published in good faith and objectively and for informational purposes only. The reader is solely responsible for any actions taken by him on the basis of information received on our website.