Why Bitcoin Close Below $38K Could Spark Larger Degree Correction

Bitcoin price started a downward correction from the $ 41,000 zone against the US dollar. BTC is struggling to stay above $ 38,000 and it will likely continue to decline.

  • Bitcoin failed to stay above the $ 40,000 pivot level and started a new decline.
  • The price struggles to stay above $ 38,000 and the 100 hour simple moving average.
  • The hourly chart of the BTC / USD pair (data feed from Kraken) broke below a major bullish trend line with support near USD 38,550.
  • The pair is likely to continue lower unless there is a strong move above $ 39,200.

Bitcoin price shows bearish signs

After trading above the USD 40,000 level, Bitcoin price failed to extend profits. BTC was trading near $ 41,000 and recently started a new drop. There was a pause below the $ 40,000 and $ 39,200 support levels.

The price was even below the support level of $ 38,600 and the 100 hour simple moving average. There was also a break below a major bullish trendline with support near $ 38,550 on the hourly chart for the BTC / USD pair.

Source: BTCUSD on TradingView.com

A low is being formed near the $ 37,400 level and the price is currently rebounding. It corrected over the recent 50% decline in the fib retracement level from the high of $ 39,778 to the low of $ 37,403. It is now struggling to stay above $ 38,000 and the 100 hour simple moving average.

A bearish bearish trendline is also forming on the same chart with resistance near $ 38,880. The trendline is close to the recent 61.8% decline in the fib retracement level from the high of $ 39,778 to the low of $ 37,403.

If there is an upside break above the trendline resistance, the price could start a decent rebound towards $ 40,000. Conversely, the Bitcoin price could fall back below USD 38,000. The next major support is near the $ 37,400 level, below which the price could fall towards the $ 36,000 support zone.

New rise in BTC?

If Bitcoin manages to stay above $ 38,000 or $ 37,500, it could push it up again. Initial resistance is near the USD 38,800 zone and the bearish trendline.

A sharp break above the trendline resistance and a subsequent move above $ 39,200 could potentially result in a steady rise in upcoming sessions.

Technical indicators:

Hourly MACD – The MACD is gaining momentum in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC / USD is now well below the 50 level.

Major Support Levels – $ 38,000 followed by $ 37,500.

Main Resistance Levels – $ 38,800, $ 39,200, and $ 40,000.

Stay in the Loop

Get the daily email from CryptoNews that makes reading the news actually enjoyable. Join our mailing list to stay in the loop to stay informed, for free.

Latest stories

- Advertisement - spot_img

You might also like...