40-40.5K pullback and 45.25K target

7 Feb 2022Morning folks,

It was a good rally last week, the H&S pattern that we've discussed has not even been formed, but the major test still stands ahead. The point is 44.70-46.50K is a strong weekly resistance area. Upward action looks nice but mostly it is due to the weakness in the USD but not of strength in BTC itself. We suggest that it is too early to forget about the downside trend and 26K target. We suggest that BTC shows a downside reaction from ~45-46K area and it should be a moderate pullback at least. Although we do not exclude the downside continuation also.

In the short-term BTC has free space to 45-46 area and our next target is XOP @ 45.25K. But, as we have completed AB=CD and "222" Sell pattern, the minor downside pullback to 40-40.5K area could happen first.

That's being said, bears should wait when upside resistance will be touched and XOP target will be completed, while bulls could consider 40-40.5K area and 45.25K destination point.