Why Bitcoin Price Could Restart Rally Unless It Dives Below $56.5K
Bitcoin price is correcting gains from $60,000 against the US Dollar. BTC is likely to start a fresh increase as long as there is no close below $56,500 and $55,250.
- Bitcoin gained bullish momentum above $58,000, but it failed to settle above $60,000.
- The price is now trading above the $56,500 support and the 100 simple moving average (4-hours).
- There is a key bullish trend line forming with support near $56,800 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).
- The pair could start a fresh increase unless the bears gain strength below $56,500 in the near term.
Bitcoin Price is Holding Key Support
This past week, bitcoin price saw a steady increase above the $55,500 resistance against the US Dollar. The BTC/USD pair broke the $58,000 resistance and it settled above the 100 simple moving average (4-hours).
The pair even climbed above the $59,500 level and spiked above the $60,000 resistance. However, there was no close above the $60,000 level. A high was formed near $60,030 and the price started a fresh decline. It broke the $58,500 and $58,000 support levels.
The price declined below the 23.6% Fib retracement level of the upward move from the $50,465 swing low to $60,030 swing high. There was also a break below a connecting bullish trend line with support near $59,000 on the 4-hours chart of the BTC/USD pair.
Source: BTCUSD on TradingView.com
The pair tested the $56,500 support zone and the 100 simple moving average (4-hours). There is also another bullish trend line forming with support near $56,800 on the same chart.
If there is a downside break below the trend line support, $56,500, and the 100 simple moving average (4-hours), there are chances of a major decline towards $55,250. It is close to the 50% Fib retracement level of the upward move from the $50,465 swing low to $60,030 swing high. Any more losses might call for a test of $53,800.
Fresh Increase in BTC?
If bitcoin stays above the $56,500 support and the 100 simple moving average (4-hours), there are chances of a fresh increase.
The first key resistance is near the $58,000 level. A successful close above the $58,000 level might open the doors for a fresh push toward the main $60,000 resistance zone. The next key barrier sits near $62,000.
Technical indicators
4 hours MACD – The MACD for BTC/USD is gaining momentum in the bearish zone.
4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is now well below the 50 level.
Major Support Level – $56,500
Major Resistance Level – $58,000
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OhNoCrypto
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, @KhareemSudlow
