Bitcoin Reaches Key Juncture, Why Recovery Won’t Be Easy
Bitcoin traded towards $41,200 before recovering against the US Dollar. BTC must clear $42,800 to start a fresh increase in the near term.
- Bitcoin extended decline and traded below the $42,000 support zone.
- The price is still trading below $43,000 and the 100 hourly simple moving average.
- There is a crucial bearish trend line forming with resistance near $42,780 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The pair could start a fresh increase if there is a clear move above the $42,800 resistance.
Bitcoin Price Approaches Key Resistance
Bitcoin price remained in a negative zone below the $43,000 pivot level. BTC even broke the $42,000 support level and settled below the 100 hourly simple moving average.
A low was formed near $41,288 and the price is now correcting higher. There was a move above the $42,000 resistance zone. The price climbed above the 23.6% Fib retracement level of the key drop from the $43,800 swing high to $41,288 low.
On the upside, an initial resistance is near the $42,550 level. It is near the 50% Fib retracement level of the key drop from the $43,800 swing high to $41,288 low.
The main resistance is now forming near the $42,800 level. There is also a crucial bearish trend line forming with resistance near $42,780 on the hourly chart of the BTC/USD pair. An upside break above the trend line resistance could start a steady increase above $43,000.
Source: BTCUSD on TradingView.com
The next key resistance is near the $43,500 level. Any more gains may perhaps call for a test of the $44,000 resistance zone. The next major resistance is near the $44,800 level.
Fresh Drop in BTC?
If bitcoin fails to start a fresh increase above $42,800, it could start a fresh decline. An immediate support on the downside is near the $42,200 zone.
The first major support is seen near the $42,000 zone. A downside break below the $42,000 support zone could push the price back towards the $41,200 support zone. The next major support is near $40,500, below which the bears might gain strength.
Hourly MACD – The MACD is slowly gaining pace in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is above the 50 level.
Major Support Levels – $42,000, followed by $41,200.
Major Resistance Levels – $42,550, $42,800 and $43,500.