Bitcoin (BTC) is trading inside a parallel ascending channel and has created a triple-top pattern.

Whether the price breaks out or down from the channel will be a key factor in determining its future movement.

The Bitcoin price has been trading inside a parallel ascending channel since it reached a high of $13,235 on Oct 22.

Yesterday, the price dropped sharply, almost breaking down from the support line of the channel. However, a bounce followed afterward that took the price towards the middle of the channel.

At the time of writing, the price was facing significant resistance (shown as a red circle below) from both the middle of the channel and a possible descending resistance line drawn from the two previous highs.

A breakout above this level would be a significant bullish development, signaling an increase towards the resistance line of the channel and possible breakout.

Technical indicators in the six-hour time-frame are leaning on bearish, but there is ambiguity.

On the bearish side, the price has created what looks like a triple-top pattern, characterized by long upper wicks, a shooting star candle, and a bearish engulfing candlestick. Furthermore, the RSI has generated a considerable bearish divergence and the MACD is decreasing.

On the other hand, there is a hidden bullish divergence in the RSI, which could negate the regular bearish divergence since it is transpiring afterward.

The two-hour chart is leaning slightly bullish. The MACD has begun to increase and there is a slight bullish divergence.

Therefore, whether or not BTC is successful in moving above the middle of the channel will be helpful in determining a bullish or bearish trend.

It is likely that BTC began a bullish impulse on Sept 7 (shown in orange below) and is currently in wave 3. This wave has a preliminary target of $14,360 — the 3.61 Fib level of the length of wave 1.

However, the sub-wave count is not entirely clear. While the most likely scenario suggests that the price has just completed sub-wave 3 (blue) and will now correct in the short-term, the time it’s taken for the corrective movement to begin and the ambiguity in technical indicators cast some doubt.

A breakdown from the channel would likely confirm that the correction has begun.

A breakout from the aforementioned short-term descending resistance line and parallel channel would likely mean that the price has begun sub-wave 5 or is in an extended sub-wave 3.

For BeInCrypto’s previous Bitcoin analysis, click here!

Disclaimer: Cryptocurrency trading carries a high level of risk and may not be suitable for all investors. The views expressed in this article do not reflect those of BeInCrypto.

The post Bitcoin Consolidates While Giving Off Mixed Technical Signals appeared first on BeInCrypto.

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