Bitcoin started a fresh decline on Friday. It then broke the $42,500 support and is at risk of further declines according to technical analysis by NewsBTC’s Aayush Jindal.
Bitcoin Continues to Fall
Bitcoin started a decline after failing to clear the $45,500 resistance and traded below the $43,200 and $42,500 levels. There was also a close below the $42,500 level and the 100 hourly simple moving average. A bottom was formed near $41,573 and it is now consolidating losses.
The first major resistance is near the $42,200 level. There is also a key bearish trend line forming with resistance near $42,200 on the hourly chart of the BTC/USD pair. The next key resistance could be the 23.6% Fib retracement level of the $42,500 or $45,900 low to $41,573 low. The main resistance seems to be forming near the $42,850 level or the 100 hourly simple moving average. A clear move above the 100 hourly simple moving average could send the price to $43,750. This is close to the 50% Fib retracement level of the drop from the $45,900 high to $41,573 low.
Will Bitcoin Drop More?
Jindal says that if Bitcoin fails to start a fresh increase above $42,850, it may continue to decline. An immediate support on the downside is near the $41,600 area. The next major support is seen near the $41,200 level. If there is a downside break below the $41,200 support, the price could start a major decline towards the $40,000 level.
What Do Technical Indicators Say?
- Hourly MACD – The MACD is now gaining momentum in the bearish zone.
- Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is currently below the 50 level.
- Major Support Levels – 41,600 then $41,200
- Major Resistance Levels – 42200, 42.850 and 43.000
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