Bitcoin Price Discovery Waves
What could we expect when Bitcoin rallies into Price Discovery?
Welcome to the Rekt Capital Newsletter, a resource for investors who want to better navigate the crypto markets with the help of cutting-edge crypto research and unbiased market analysis.
The Weekly Downtrending Channel
Last week, we spoke about how Bitcoin had made a new Higher High and how price needed to turn the August highs into support if it wanted to try to challenge the Channel Top for a breakout attempt.
But in the event that it failed that retest, we discussed the following:
Here is today's update:
Bitcoin pulled back right into the Downtrend (light blue) that price broke a few weeks prior and successfully retested it into new support in a picture-perfect manner.
More, Bitcoin also managed to reclaim the green 21-week Bull Market EMA as support as well.
But to build on this newfound momentum, BTC will need to do what it failed to do last week:
Last week, BTC failed to retest the purple August highs (~$64200) as support and this week price will need to reclaim them if it is to try to challenge for a breakout beyond the Downtrending Channel Top.
At the moment, BTC is showcasing initial signs of resistance here but price needs only one Daily Close above $64200 to kickstart another attack of the Downtrending Channel Top (black):
To avoid a rejection from these highs, BTC would need to avoid developing a cluster of price action below it, just like it did in late August.
In other words, the sooner BTC Daily Closes above these highs, the better.
The Weekly ReAccumulation Range
In terms of the Weekly ReAccumulation Range, Bitcoin has managed to successfully retest the Range Low at $60600 (green) after having broken beyond it a few weeks prior:
That is, three weeks ago Bitcoin broke beyond the Range Low (green) as resistance, ending the downside-deviation below it (bargain-buying period, orange circle) and last week price downside wicked into that Range Low to confirm it as new support.
Technically as a result, having formed a solid base at the ReAccumulation Range Low, BTC is well-positioned for an ascent across this ReAccumulation Range.
However, BTC needs to first reclaim the $64200 August highs as mentioned earlier and then break the Downtrending Channel Top if it wants to challenge for the ReAccumulation Range High at ~$71300 (red).