Bitcoin started a strong decline from the $40,000 resistance yesterday. It is down 8% after it broke the key support at $37,500. According to technical analysis by Aayush Jindal of NewsBTC:
Bitcoin Drops 8%
Bitcoin started a fresh decline yesterday after struggling to break past the $40,000 resistance zone. There was a major decline below the $38,500 and $38,000 levels. There was a break below a key bullish trend line with support near $39,250 on the hourly chart of the BTC/USD pair. It even settled below the key $37,500 support and settled below the 100 hourly simple moving average and bottomed out at $35,407. It is currently consolidating losses near the $36,200 level.
BTC is currently facing resistance near the $36,500 level. The 23.6% Fib retracement level of the downward move from the $40,029 high to $35,407 high is also near the $36,500 area. The next key resistance could be near the last breakout area of $37,500, where the bears could take a stand. The 50% Fib retracement level of the downward move from the $40,029 high to $35,407 high is also near the $37,500 area. For a fresh rise, the price must break above the $37,500 level.
Will it drop more?
Jindal thinks that if Bitcoin fails to break through the $36,500 resistance zone, it could continue to move down. An immediate support is near the $36,000 level. The next major support is seen near the $35,500 level or the recent low. A downside break below the $35,500 support could trigger another hard decline. The next major support could be $34,200.
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 in the oversold territory.
- Major Support Levels – $36,000 followed by $35,500
- Major Resistance Levels – $36,500, 37,200 and 37,500
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