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Bitcoin price started a downside correction from well above $40,000 against the US Dollar. BTC is now trading near a major support at $38,000, where the bulls are currently active.
- Bitcoin started a downside correction after it failed to stay above $40,000.
- The price is currently just below $39,000 and the 100 hourly simple moving average.
- There was a break below a key contracting triangle with support near $39,900 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The pair is likely to start a fresh increase unless there is a close below the $38,000 support=.
Bitcoin Price Revisits Key Support
Bitcoin topped near the $41,350 before it started a downside correction. BTC consolidated above $40,000 for some time before the bulls failed to protect the mentioned support zone.
The price declined below the $40,000 and $39,500 support levels. There was also a break below a key contracting triangle with support near $39,900 on the hourly chart of the BTC/USD pair. The pair even broke the $38,500 support level and the 100 hourly simple moving average.
However, the bulls are protecting the $38,000 support zone (the last breakout zone). The price is now consolidating above the $38,000 level. It is also just below $39,000 and the 100 hourly simple moving average. The 23.6% Fib retracement level of the recent decline from the $41,350 swing high to $38,154 low is also near the 100 hourly SMA.
Source: BTCUSD on TradingView.com
The first major resistance is near the $39,750 level. It is close to the 50% Fib retracement level of the recent decline from the $41,350 swing high to $38,154 low.
The main resistance is now forming near the $40,000 zone. A clear upside break above the $40,000 zone is likely to set the pace for a fresh rally in the near term.
More Losses in BTC?
If bitcoin fails to clear the $39,750 resistance and $40,000, it could extend its decline. An initial support on the downside is near the $38,150 level.
The first major support is near the $38,000 level. A downside break below the recent low and the $38,000 level could open the doors for a larger decline towards $36,500.
Technical indicators:
Hourly MACD – The MACD is slowly moving into the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is rising towards the 50 level.
Major Support Levels – $38,150, followed by $38,000.
Major Resistance Levels – $39,500, $39,750 and $40,000.
