Bitcoin started a sharp downside correction after extending its gains to around $43,000. According to technical analysis by Aayush Jindal from NewsBTC:
Bitcoin Drops
After surging as high as $42,000, Bitcoin failed to extend its move above the 43,000 level and the price reacted to the downside. There was a sharp move below the $42,000 level. There was also a break below a major bullish trend line with support near $41,250 on the hourly chart of the BTC/USD pair. There was a break below the 50% Fib retracement level of the upward move from the $38,750 high to $42,950 high
high. Bitcoin is currently trading below $41,000 and the 100 hourly simple moving average. The price is currently consolidating above the 61.8% Fib retracement level of the upward move from the $38,750 high to $42,950 high. An immediate resistance is near the $40,750 level. The next key resistance could be $40,950 and the 100 hourly simple moving average.
$41,000 Significant
The price must settle above the $41,000 region and the 100 hourly simple moving average to start a strong upward move. If the bulls are successful, the price could rise towards the $41,800 resistance zone.
Will Bitcoin Drop?
Jindal could continue to move lower if Bitcoin fails to break past the $41,000 resistance zone. An immediate support on the downside is near the $40,250 level. The next major support is seen near the $40,000 level. A downside break below the $40,000 zone could lead the price towards the $39,250 support zone.
What Do Technical Indicators Say?
- Hourly MACD – MACD is slowly 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 – $40,250 followed by $40,000
- Major Resistance Levels – $40,750, 41,000 and 41,800
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