Bitcoin Struggles Below $38K, Why BTC Could Dive To $32K
Bitcoin price is struggling to clear the $38,000 and $40,000 resistance levels against the US Dollar. BTC is currently consolidating above $36,000 and it remains at a risk of a downside break.
- Bitcoin is trading in a short-term bearish zone below the $38,000 and $40,000 resistance levels.
- The price is holding a key support zone near $35,600 and the 100 simple moving average (4-hours).
- There is a major contracting triangle forming with support near $35,550 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).
- The pair could start a strong decline if it clears the $35,500 and $35,000 support levels in the near term.
Bitcoin Price Correcting Gains
This past week, bitcoin price climbed higher sharply above the $38,000 resistance against the US Dollar. The BTC/USD pair even spiked above the $40,000 resistance, but it failed to continue higher.
A high was formed near $40,036 and the price settled well above the 100 simple moving average (4-hours). Recently, there was a fresh decline and the price broke the $38,000 support. It even traded below the $36,000 level and formed a low at $34,319.
The price is currently consolidating above the $35,000 level and the 100 simple moving average (4-hours). It was already rejected once near the 61.8% Fib retracement level of the recent decline from the $40,036 swing high to $34,319 low.
Source: BTCUSD on TradingView.com
There is also a major contracting triangle forming with support near $35,550 on the 4-hours chart of the BTC/USD pair. The triangle support is near the $35,000 breakdown zone and the 100 simple moving average (4-hours).
If there is a downside break below the $35,500 and $35,000 support levels, bitcoin price might accelerate lower. The next major support on the downside is near the $34,000 level. Any more losses could open the doors for a push towards the $32,000 and $30,000 support levels in the near term.
Upside Break in BTC?
If bitcoin stays above the triangle support, $35,000, and the 100 simple moving average (4-hours), it could start a fresh increase.
The main resistance on the upside is near the $38,600 zone and the triangle upper trend line. It is close to 76.4% Fib retracement level of the recent decline from the $40,036 swing high to $34,319 low. A close above the $38,600 level could open the doors for a strong surge above $40,000.
Technical indicators
4 hours MACD – The MACD for BTC/USD is losing momentum in the bullish zone.
4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.
Major Support Level – $35,500
Major Resistance Level – $38,600
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, @KhareemSudlow
