Bitcoin is struggling to clear the $40,000 resistance zone against the US Dollar. According to technical analysis by NewsBTC’s Aayush Jindal, BTC needs to break above $40,000 to start a steady upward move.
Bitcoin Faces Main Resistance
Bitcoin bulls made several attempts to clear the $40,000 resistance zone but failed. The last local top was formed near $39,888 before a downside correction was made. There was a move below the $39,000 and $38,800 support levels. Besides, there was a break below a short term contracting triangle formation with support near $38,800 on the hourly chart of the BTC/USD pair.
The pair is currently trading below $39,000 and the 100 hourly simple moving average. A bottom was formed near $37,028 and the price is consolidating losses.
Initial resistance is near the $38,200 level and the 100 hourly SMA. The next key resistance is near the $38,500 level. This is close to the 50% Fib retracement level of the downward move from the $39,888 high to $37,028 high. The main resistance is currently near the $38,800 level. This is near the 61.8% Fib retracement level of the downward move from the $39,888 high to $37,028 high. A clear move above the $38,800 resistance could push the price higher. In the indicated case, a clear move above $40,000 could be attempted.
Are Drops Limited?
Jindal says that if Bitcoin fails to break past the $38,800 resistance zone, it could initiate a downside correction. An immediate support on the downside is near the $37,200 area. The next major support is seen near the $36,400 level. If there is a downside break below the $36,400 support, the price could gain bearish momentum towards $35,000.
What Do Technical Indicators Say?
- Hourly MACD – The MACD is now losing momentum in the bearish zone.
- Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is currently below the 50 level.
- Major Support Levels – 37,200 then $36,400
- Major Resistance Levels – 38,200, 38,800 and 40,000
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