After getting sold off from the middle of February to early this month, bitcoin price seems to have found its footing on the charts. The daily time frame reveals that BTCUSD found support at the rising trend line (from connecting the lows of December 18 and January 2). The Fibonacci retracement tool also shows that the price where BTCUSD found support on, around 8,700.00, coincides with the 50% Fib level (when you draw from the low of January 3 to the high of February 13).
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A closer look at the 4-hour time frame also suggests that the cryptocurrency would rally soon. It shows that bitcoin price has made a higher low after making a series of lower lows. Consequently, an inverse head and shoulders pattern has materialized at the support level. In forex trading, this chart pattern is considered as a bearish reversal pattern. It suggests that the sell-off in bitcoin price is over and that it would trade higher soon. A strong bullish close above the high of March 2 at 8,973.45 would effectively break the neckline resistance. We could soon then see BTCUSD rally to resistance around 9,590.00. This price coincides with the falling trend line from connecting the highs of February 13, February 19, and February 24. It also aligns with the 100 SMA.
On the other hand, be wary of a close below the recent low at 8,635.31. This would invalidate the inverse head and shoulders and mean that BTCUSD could still drop to support at 7,786.12.
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