Technicals Suggest Bitcoin Could Correct To $10,700 Before Fresh Increase
Bitcoin is struggling to gain momentum above the $11,200 level against the US Dollar. BTC is currently correcting lower and it could test $10,700 before a fresh increase.
- Bitcoin is showing signs of a downside correction below the $11,200 level.
- The price is likely to find a strong buying interest near the $10,700 level.
- There was a break below a crucial bullish trend line with support near $10,900 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The pair could start a fresh increase as long as it is above $10,700 and $10,300 in the near term.
Bitcoin Price Correcting Gains
After a downside correction from $11,400, bitcoin found support near the $10,700 level against the US Dollar. BTC remained well bid above the $10,700 level and the 100 hourly simple moving average.
It climbed back above $11,000, but it struggled to gain strength above the $11,200 level. A high is formed near $11,195 and the price is currently correcting lower. It traded below the $11,100 and $11,000 levels.
There was a break below a crucial bullish trend line with support near $10,900 on the hourly chart of the BTC/USD pair. The pair is now testing the 50% Fib retracement level of the recent upward move from $10,599 swing low to $11,195 high.
Bitcoin price above $10,000. Source: TradingView.com
The next major support is near the $10,820 level. It is close to the 61.8% Fib retracement level of the recent upward move from $10,599 swing low to $11,195 high. The main support is near the $10,700 level.
A successful close below the $10,700 level may perhaps start an extended decline. In the mentioned case, the price is likely to test the $10,300 support zone.
Fresh Increase in BTC?
Once the current correction wave is complete, bitcoin price is likely to resume its upward move above $11,000. The first major resistance is near the $11,200 level.
A successful close above the $11,200 level is needed to start a fresh increase. The next major resistance on the upside is near the $11,400 and $11,500 levels. Any further gains could open the doors for a push towards the main $12,000 resistance in the near term.
Technical indicators:
Hourly MACD – The MACD is currently gaining pace in the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now correcting lower towards the 50 level.
Major Support Levels – $10,700, followed by $10,300.
Major Resistance Levels – $11,200, $11,400 and $11,500.
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Aayush Jindal, Khareem Sudlow