}
Hey friends, hope you are well and welcome to a new update on Bitcoin.
Harmonic bearish Butterfly move:
Three weeks ago, I told you that bitcoin is completing the final leg of the bearish Butterfly pattern on the long-term monthly chart. Now finally the price action has rallied up to $24211 and completed this leg. Now there are chances of price reversal because the price action already has spiked in the potential reversal zone of this bit bearish Butterfly pattern.
Previous harmonic bullish Gartley move:
This is quite a similar move that Bitcoin completed in April 2020, but that was bullish Gartley. At that time when the final leg was completed, then I posted an article and video where I said that the price action has entered in potential reversal zone and it can be reversed from here. Eventually, the priceline reversed, and sofar it has rallied more than 255%.
Gartley move before execution:
Previous Gartley move after 255% bullish rally
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The exponential moving averages:
On the long-term weekly chart, the price action of the leading cryptocurrency is at a high distance from the exponential moving averages with the time period of 10 and 21, therefore, if the correction rally will be started then we can expect a move up to exponential moving average 21 that is at $15250 at the time of writing.
Bearish divergence on the daily chart:
If we switch to the daily time period chart, then it can be observed that the price action is forming higher highs, but the RSI is moving in the opposite direction sliding down and stochastic is in a sideways trend. But if we switch to the smaller time period charts like in hourly, 4 hourly, and 12 hourly, then the RSI stochastic and price action of Bitcoin altogether are in an uptrend. So, on the daily chart, we have received a weak signal for bearish divergence, but once this bearish divergence signal will be reflected on the smaller time period charts as well, then we can be confirmed that a downtrend can be started.
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Fractal resistance and supports:
If we place the zigzag indicator on the daily time frame chart, then it can be clearly observed that from 2nd Oct to 26 Nov, the Zigzag indicator was ignoring all up and down moves and not showing any pattern, this shows the power of bulls. Now finally, after 1st Dec the Zigzag is showing the correction move. It can be an indication that now soon we will have a sideways move or a start of a downtrend. Here we can also watch the fractals, like previously from 26 Nov to 11 Dec we had bearish reversal fractal resistance at $19900 and the price action broke out that resistance and started the next rally. Now if the price action will form bearish and bullish reversal fractals then we should observe, whether the price action breaks the resistance or support, if the support will be broken down then a rally to the downside can be confirmed.
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Conclusion:
At the moment the bulls are in power and we have received very weak bearish signals. But the price action has also entered the potential reversal zone of the Butterfly pattern, therefore a bearish reversal from here is very much possible.