Bitcoin is consolidating above the $39,250 support zone. According to technical analysis by NewsBTC’s Aayush Jindal, it could rally if it manages to clear the $40,250 resistance zone.
Bitcoin Continues to Find Support
Bitcoin attempted an upside correction above the $40,000 level. BTC rallied above the $40,400 level, but the bears remained active. BTC struggled to stay above the 23.6% Fib retracement level of the decline from the $43,416 low to $39,240 low. A high was formed near $40,800 and the price started another decline. There was a break below the $40,000 level, but the bulls again defended the $39,250 zone.
BTC is now consolidating near the $40,000 level, but well below the 100 hourly simple moving average. An immediate resistance is near the $40,250 level. There is also a connecting bearish trend line forming with resistance near $40,250 on the hourly chart of the BTC/USD pair.
A clear move above the trendline could send the price towards $40,800. The next resistance could be near $41,250. This is close to the 50% Fib retracement level of the key decline from the $43,416 high to $39,240 high.
If the bulls can clear the $41,250 and $41,350 resistance levels, BTC could rally higher. In this case, the price could rise towards the $41,800 resistance area or the 100 hourly simple moving average.
Will Bitcoin Drop More?
Jindal says that if Bitcoin fails to break past the $40,250 resistance zone, it may continue to move lower. An immediate support on the downside is near the $39,600 level. The next major support is seen near the $39,250 level. A downside break below the $39,250 support zone could accelerate losses. In the stated case, the price could drop to $38,500 or even $38,000.
What Do Technical Indicators Say?
- Hourly MACD – The MACD is slowly gaining momentum in the bullish zone.
- Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now just above the 50 level.
- Major Support Levels – 39,600 then $39,250
- Major Resistance Levels – $40,250, 41,250 and 41,800
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