Bitcoin Price Analysis: BTC/CNY Correction Initiated
Bitcoin price made a new high against the Chinese Yuan and the US Dollar before starting a correction. The BTC/CNY pair may correct more, as it is testing a major support at the moment.
There is a major bullish trend line formed on the hourly chart of BTC/CNY (data feed via BTCCHINA), which is currently acting as a support and preventing any further corrections.
Bitcoin Price Correction
The BTC to CNY traded further higher recently and moved above the 5400 level for a move as high as 5479. There were offers around the stated level, which then ignited a downside move.
The pair started a correction, and already moved below the 23.6% Fib retracement level of the last wave from the 5140 low to 5479 high. At the moment, the price is trading near a major support area in the form of a bullish trend line on the hourly chart of BTC/CNY (data feed via BTCCHINA).
The trend line support holds a lot importance. The main reason is the fact that the same trend line is coinciding with the 100 hourly simple moving average. Moreover, the 38.2% Fib retracement level of the last wave from the 5140 low to 5479 high is also just below the trend line support.
So, if there is a break below the trend line support, then it may ignite more losses in the short term. The next support in that case is around the 5300 handle.
The hourly MACD for the BTC/CNY pair also changed the slope from the bullish to the bearish zone. So, there is a chance of a break down as well. However, we cannot deny that the trend line may produce a bounce as well.
So, it is best to trade with a break in BTC to CNY in the short term.
Chart Source – TradingView.com and data feed by BTCCHINA