Bitcoin Price Breaking This Confluence Support Could Spark a Major Drop

[Bitcoin]

Bitcoin Price Breaking This Confluence Support Could Spark a Major Drop

Bitcoin price failed to stay above $20,600 and extended losses. BTC must stay above $20,000 to avoid a major decline in the near term.

• Bitcoin started a downside correction and broke a major support at $20,600.


• The price is trading below $20,600 and the 100 hourly simple moving average.


• There is a major bearish trend line forming with resistance near $21,050 on the hourly chart of the BTC/USD pair (data feed from Kraken).


• The pair could revisit the main $20,000 support zone in the near term.

Bitcoin Price Dips Further

Bitcoin price formed a swing high near the $21,469 level and recently started a downside correction. BTC declined below the $21,200 and $21,000 levels.

The bears were able to push the price below the key $20,600 support and the 100 hourly simple moving average. There was a clear move below the 50% Fib retracement level of the main increase from the $20,050 swing low to $21,470 high.

The decline gained pace below the $20,500 level. Bitcoin price even tested the 76.4% Fib retracement level of the main increase from the $20,050 swing low to $21,470 high.

The price is now trading below $20,600 and the 100 hourly simple moving average. On the upside, an immediate resistance is near the $20,600 level. The first major resistance is near the $21,000 level. There is also a major bearish trend line forming with resistance near $21,050 on the hourly chart of the BTC/USD pair.

Source: BTCUSD on TradingView.com

A clear move above the trend line resistance and $21,200 might start a fresh increase towards $21,500. The next major resistance is near $22,000, above which the price could test the $22,500 zone.

More Losses in BTC?

If bitcoin fails to start a recovery wave above the $20,600 resistance zone, it could resume its decline. An immediate support on the downside is near the $20,380 level.

The next major support is near the $20,050 zone. A clear move below the $20,050 support might push the price into a bearish zone. In this case, the price may perhaps decline towards the $19,200 level.

Technical indicators:

Hourly MACD - The MACD is now gaining pace in the bearish zone.

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

Major Support Levels - $20,380, followed by $20,050.

Major Resistance Levels - $20,600, $21,000 and $21,200.

Source: Bitcoin Price Breaking This Confluence Support Could Spark a Major Drop