Bitcoin Key Indicators Suggest Strengthening Before Decent Rise


Bitcoin is showing positive signs above USD 39,500 against the US dollar. BTC needs to clear $40,250 to stay higher in the near term.

Bitcoin started another wave of recovery and climbed above the USD 39,800 level. The price is now trading above $39,500 and the 100 hourly simple moving average. A major bullish trendline is forming with support near $39,580 on the hourly chart of the BTC/USD pair (Kraken data feed). The pair must overcome the USD 40,250 resistance to continue higher in the near term.

Bitcoin Price Eyes Upside Down Break

Bitcoin price started another wave of recovery above the $38,500 resistance level. BTC cleared the USD 39,250 and USD 39,500 resistance levels to move into positive zone.

There was a move above the 50% Fib retracement level of the main drop from the $40,774 swing high to $37,670 swing low. A major bullish trendline is also forming with support near $39,580 on the hourly chart of the BTC/USD pair.

Bitcoin price is now trading above USD 39,500 and the 100 hourly simple moving average. It even peaked above the $40,000 resistance.

However, there was no close above the 76.4% Fib retracement level of the key drop from the $40,774 swing high to $37,670 swing low. On the upside, there is an immediate resistance near the USD 40,000 level. The next key resistance could be near the $40,250 zone.

Source: BTCUSD on TradingView.com

A close above the USD 40,250 level could open the doors for some decent gains. In the mentioned case, the price could even surpass the $40,800 resistance. The next major resistance may be near the $41,250 zone.

New decline in BTC?

If bitcoin fails to clear the $40,250 resistance zone, it could start another decline. An immediate support on the downside is near the $39,750 level.

The next major support is seen near the trendline and $39,580. A clear break below the trendline support and $39,500 could open the doors for another drop. In this case, the price may drop to the $39,000 level. If there are further losses, a test of the $38,400 support may be needed.

Technical indicators:

Hourly MACD – The MACD is slowly losing pace in the bullish zone.

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

Key support levels – $39,580 followed by $38,400.

Major resistance levels – $40,250, $40,800 and $41,250.

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