TA: Bitcoin Price Corrects 5%, Why Bulls Are Still Comfortable
Bitcoin price formed a double top pattern near $19,500 and corrected lower against the US Dollar. BTC is now trading below $18,500 and it could test the $18,000 support or $17,600.
- Bitcoin failed again to clear the $19,500 resistance and started a sharp downside correction.
- The price declined sharply below the $19,000 level and the 100 hourly simple moving average.
- There was a break below a major bullish trend line with support near $19,000 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The pair is now approaching the $18,120 and $18,000 support levels.
Bitcoin Price Forms a Double Top
There was another attempt by bitcoin price to clear the $19,450 and $19,500 resistance levels, but it failed. A double top pattern was formed near the $19,500 level and there was a sharp decline in bitcoin price below the $19,000 support.
The price declined below many key supports near $19,000 and the 100 hourly simple moving average. There was also a break below a major bullish trend line with support near $19,000 on the hourly chart of the BTC/USD pair.
Bitcoin broke the last swing low at $18,656 and extended its decline below the $18,500 level. The bears pushed the price below the 1.236 Fib extension level of the upward move from the $18,656 swing low to $19,511 swing high.
It is now approaching the $18,100 support level. It is close to the 1.618 Fib extension level of the upward move from the $18,656 swing low to $19,511 swing high. If there are more downsides, the price could even break the $18,000 support level.
In the stated case, the price is likely to continue lower towards the $17,620 and $17,500 support levels in the coming sessions.
Recovery in BTC?
If bitcoin stays above the $18,100 and $18,000 support levels, there could be a fresh increase. An initial resistance is near the $18,500 level.
The first major resistance is forming near the $18,700 level and the 100 hourly simple moving average. The main resistance sits at $19,000, above which the price could rise towards the $19,500 resistance zone in the near term.
Hourly MACD – The MACD is now gaining momentum in the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is currently well below the 50 level and approaching 20.
Major Support Levels – $18,000, followed by $17,620.
Major Resistance Levels – $18,500, $18,700 and $19,000.