Bitcoin (BTC) was rejected by the $10,900 area and dropped sharply afterward.

It is possible that the price completed its retracement and will soon move upwards.

On Oct 1, the BTC price reached a high of $10,920, creating a double-top relative to the price on Sept 28. The top was created near the 0.786 Fib level of the previous decrease, making it a likely reversal level.

After generating bearish divergence in both the RSI and MACD, the price dropped sharply, reaching a low of $10,385. BTC has since bounced back slightly and is currently trading near $10,440.

The shorter-term 2-hour chart shows that after the decrease, the price reached the 0.618 Fib level of the previous upward movement and is trading between the 0.618-0.786 Fib levels at $10,310-$10,440.

Despite the decrease, there are two bullish signs that have transpired:

These are signs that the price may have likely completed its decrease and will soon head upwards.

Despite the decrease, the current movement seems more like the ending of a correction rather than the beginning of a new downward trend.

It is possible that the movement was the end of wave 2 (shown in blue below), which transpired inside an A-B-C formation (red). In this particular pattern, the A:C waves had a ratio of 1:1.61, very common in such corrections.

The decreasing volume also supports this possibility. If the wave count is correct, the price will likely soon move upwards.

In a longer-term perspective, BTC seems to have begun an impulse on Sept 9 (in orange below). It seems to have already completed waves 1 and 2 and is currently in wave 3.

Inside wave 3, the price has completed sub-waves 1-2 (blue) and should soon begin sub-wave 3, which has a preliminary target between $11,985-$12,314.

To conclude, it is possible that BTC has completed its correction and will gradually begin to move upwards.

For BeInCrypto’s previous Bitcoin analysis, click here!

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