Bitcoin price is still struggling to clear $40,000 and $ 41,000 against the US Dollar. If there is a clear break below $37,000 and $36,500, BTC could drop significantly. According to technical analysis by NewsBTC’s Aayush Jindal:
Bitcoin is still struggling to clear the $40,000 and $40,500 resistance levels.
There is a key contracting triangle forming with support near $37,500 on the hourly chart of the BTC/USD pair (data from Kraken).
The pair could decline drastically if it breaks below the $37,000 support and the 100 hourly SMA.
Bitcoin Price Faces Major Barriers
Bitcoin made another attempt to gain bullish momentum above the $40,000 resistance. However, BTC failed to continue higher and remained in a key range below $40,500.
The last surge was formed around $40,923 before the price started moving in a range. There was a correction below the 23.6% Fib retracement level of the upward move from the $31,088 high to $40,923 high.
There is also a key contracting triangle forming with support near $37,500 on the hourly chart of the BTC/USD pair. If the Bitcoin formation remains above the support trend line, it could initiate a new increase above $39,000.
On the upside, a sudden resistance is near the $39,200 level. The first major resistance is near the $40,000 level and the upper trend line of the pattern. A close above the formation resistance could open the doors for a sharp increase above the $40,500 and $40,600 resistance levels in the near term.
Will Bitcoin (BTC) Price Drop?
If Bitcoin fails to break the $40,000 resistance, there is a risk of a downside break. The first major support is near the $36,000 pivot level. It is close to the 50% Fib retracement level of the upward move from the $31,088 low to $40.923 high. If there is a downside break below the $36,000 support, the price could drop towards the $34,000 support zone in the coming sessions.
Hourly MACD – The MACD is slowly gaining momentum in the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is currently below the 50 level.
Major Support Levels – $37,000 then $36,000
Major Resistance Levels – $39,500, $40,000, and $40,500