TA: Bitcoin Tops Near $40K, Why BTC Remains Well Supported

Bitcoin price surged and it even spiked above the $40,000 resistance against the US Dollar. BTC is correcting gains, but it is likely to remain stable near $36,000.

  • Bitcoin started a strong increase above the $36,000 and $38,000 resistance levels.
  • The price is now trading well above $36,000 and the 100 hourly simple moving average.
  • There is a major bullish trend line forming with support near $36,100 with resistance near $31,250 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The pair correcting gains, but it is likely to find a strong support near $36,000.

Bitcoin Price Corrects Gains

Bitcoin price started a major increase after it broke the key $35,000 resistance zone. It opened the doors for a steady rise above the $36,500 level and the 100 hourly simple moving average.

The price surged above the $38,000 level and finally it spiked above the $40,000 resistance. However, the bulls struggled to keep the price above the $40,000 level. A high was formed near $40,484 and the price started a downside correction.

There was a break below the $38,500 and $38,000 level. Bitcoin even declined below the 50% Fib retracement level of the upward move from the $33,950 swing low to $40,484 high.

Bitcoin Price

Source: BTCUSD on TradingView.com

The price is now consolidating near the $37,000 support zone. There is also a major bullish trend line forming with support near $36,100 with resistance near $31,250 on the hourly chart of the BTC/USD pair. On the upside, an initial resistance is near the $38,000 level.

The first major resistance is near the $38,500 level. The main resistance is still near the $40,000 zone. A successful break and close above the $40,000 level could spark additional gains in the near term.

Dip Limited in BTC?

If bitcoin fails to climb above the $38,000 and $38,500 resistance levels, it could continue to move down. An initial support on the downside is near the $36,500 level.

The first major support is now near the $36,000 zone. A clear downside break below the $36,000 support and the trend line may possibly push the price towards the $35,000 support zone in the near term.

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 – $36,500, followed by $36,000.

Major Resistance Levels – $38,000, $38,500 and $40,000.

Publication date: 
07/27/2021 - 03:08
Author: 
Disclaimer

The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.