Bitcoin failed to surpass the $7,000 resistance and declined below $6,500 against the US Dollar. BTC is likely to bounce back as long as it is above $6,000 and the 100 SMA (H4).
- Bitcoin price is currently correcting gains from the $7,000 resistance area.
- The $6,000 region and the 100 simple moving average (4-hours) are important supports.
- There was a break below a major bullish trend line with support at $6,620 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).
- The pair is currently consolidating losses above the $6,000 and $6,100 levels.
Bitcoin is Approaching Crucial Support
This past week, bitcoin struggled to gain strength above the $6,880 and $7,000 resistance levels against the US Dollar. BTC price topped near the $6,982 level and recently started a fresh decline.
There was a break below the main $6,500 support area to start a substantial decline. Moreover, there was a break below a major bullish trend line with support at $6,620 on the 4-hours chart of the BTC/USD pair.
The pair even declined below the $6,200 support and traded close to the $6,000 area. A new weekly low is formed near the $6,048 level and the price is currently consolidating losses. An initial resistance on the upside is near the $6,270 level since it is close to the 23.6% Fib retracement level of the recent decline from the $6,982 swing high to $6,048 low.
On the downside, there are a couple of important supports near $6,050 and $6,000. The main support for bitcoin is near the $5,950 level and the 100 simple moving average (4-hours).
If BTC fails to stay above the 100 SMA, there is a risk of a larger decline below $5,800. An immediate support is near $5,750, below which the price is likely to decline towards the $5,500 level.
Fresh Increase
The main support for bitcoin is forming near the $6,000 area and the 100 SMA. If the price stays above the 100 SMA, there are chances of a strong recovery wave above the $6,300 level.
The next resistance is near the $6,500 region (the recent breakdown support). The 50% Fib retracement level of the recent decline from the $6,982 swing high to $6,048 low is also near $6,515.
Therefore, a successful break above the $6,500 resistance area could start a fresh increase towards the $6,800 and $7,000 resistance levels.
Technical indicators
4 hours MACD – The MACD for BTC/USD is about to move back into the bullish zone.
4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is currently flat near the 40 level.
Major Support Level – $6,000
Major Resistance Level – $6,500
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