Bitcoin corrected lower below $8,700, but it found a strong support above $8,500 against the US Dollar. BTC price is currently rising and it could rally if it clears the $8,840-$8,900 resistance area.
- Bitcoin price might not go down quietly and it could rally above $8,800 against the US Dollar.
- The double top pattern is still valid unless the bulls clear the $8,900 resistance.
- There is a new breakout pattern forming with resistance near $8,825 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The main supports on the downside are near $8,580 and $8,500.
Bitcoin Bears Struggle To Gain Traction
Yesterday, we saw a downside correction in bitcoin after it was rejected near the $8,900 resistance against the US Dollar. BTC price declined below the $8,700 support level, but the bulls defended the $8,540 and $8,500 levels.
The bears made many attempts to break the neckline support of the double top pattern at $8,540, but they failed. As a result, the price started a decent increase and traded above the $8,700 resistance.
Moreover, bitcoin climbed above the 50% Fib retracement level of the recent decline from the $8,866 high to $8,578 low. It is now approaching the $8,800 and $8,820 resistance levels.
The 76.4% Fib retracement level of the recent decline from the $8,866 high to $8,578 low is also near $8,800. More importantly, there is a new breakout pattern forming with resistance near $8,825 on the hourly chart of the BTC/USD pair.
If the bulls manage to push the price above the triangle resistance and $8,840, there are high chances of more upsides above the $8,900 resistance. In the mentioned case, the double top pattern is likely to invalidate and the price might rally above $9,000 in the near term.
What If BTC Stays Below $8,900
If BTC price fails to climb above the triangle resistance and $8,840, it is likely to move down. The first key support is near the triangle at $8,640.
If there is a downside break, the bears may perhaps aim a clear break below the key $8,540 and $8,500 support levels. If they succeed, the price is likely to decline towards $8,200.
Overall, bitcoin bulls are giving a tough fight and it seems like a breakdown below the $8,540 and $8,500 support levels won’t be easy.
Technical indicators:
Hourly MACD – The MACD is now gaining momentum in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is back above the 50 level.
Major Support Levels – $8,640 followed by $8,540.
Major Resistance Levels – $8,825, $8,840 and $8,900.
