Bitcoin (BTC/USD) closed with a Doji candle yesterday. This indicates indecision after several bullish daily candles made an impressive new all-time high at $24,000.
The angle of and distance between the moving averages confirm the massive uptrend at the moment. But is it time for some type of pullback? Let’s review.
BTC/USD is currently developing a wave 3 (blue). As long as price action stays above the smaller 38.2-50% Fibonacci support zone, then price action is expected to stay in that wave 3.
In that case, price could easily go sideways and then break up north (blue arrow) for a new all-time high at the round psychological level of $25,000.
A bearish breakout, however, could indicate a larger retracement. This could start a wave 4 (blue) pattern:
On the 4 hour chart, price action has completed a wave 5 (purple) of wave 3 (pink) at the recent high.
The current retracement seems to be a wave A (purple). Price action will probably build an ABC correction or ABCDE triangle pattern.
After the consolidation pattern is completed, a breakout above the resistance would confirm the continuation of the uptrend within wave 5 (pink).
Price action should bounce at the long-term moving averages (blue box) and Fibonacci support zone, otherwise a larger retracement is taking place on the daily chart.