Analysis

TA: Bitcoin Consolidating Gains, Why Close Below $17.5K Could Be Significant

Bitcoin price surged towards the $ 18,500 level before correcting lower against the US Dollar. BTC must stay above $ 17,500 for upside continuation in the near term.

  • Bitcoin rallied further towards the $ 18,500 level before correcting lower sharply.
  • The price is holding the key $ 17,500 support and it is well above the 100 hourly simple moving average.
  • There is a major contracting triangle forming with resistance near $ 18,020 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The pair could start a fresh rally if there is a proper close above $ 18,000 and $ 18,200.

Bitcoin Price Holding Key Supports

Yesterday, there was a sharp increase in bitcoin price above the $ 17,500 resistance level. BTC climbed over 10% and it even broke the $ 18,000 level. The price traded to a new multi-month high near $ 18,500 before it started a sharp decline.

The price crashed over $ 1,000 and it broke the $ 17,800 support. There was also a spike below the $ 17,500 support, but there was no close below it. The recent swing low was formed near $ 17,299 and the high was formed near $ 18,107.

The price is now consolidating gains below $ 18,000. There is also a major contracting triangle forming with resistance near $ 18,020 on the hourly chart of the BTC/USD pair. The pair is testing the 23.6% Fib retracement level of the recent wave from the $ 17,299 swing low to $ 18,107 high.

Bitcoin Price

Bitcoin Price

Source: BTCUSD on TradingView.com

The first major support seems to be forming near the $ 17,700 level and the triangle lower trend line. It is close to the 50% Fib retracement level of the recent wave from the $ 17,299 swing low to $ 18,107 high.

If there is a downside break below the triangle support, the price could test the $ 17,500 support. A proper close below the $ 17,500 support might start a strong decline in the coming days.

Fresh Rally in BTC?

If bitcoin clears the triangle resistance and then the $ 18,107 swing high, it could rally again. The next immediate hurdle is near the $ 18,200 level.

A proper follow through move above the $ 18,200 level is likely to open the doors for a larger increase. The next major resistance is near $ 18,500 and $ 18,880.

Technical indicators:

Hourly MACD – The MACD is slowly losing momentum in the bearish zone.

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

Major Support Levels – $ 17,700, followed by $ 17,500.

Major Resistance Levels – $ 18,020, $ 18,200 and $ 18,500.

Let’s block ads! (Why?)

Technical analysis – NewsBTC

Leave a Reply

Your email address will not be published. Required fields are marked *