Yesterday, we saw a strong double top formation for bitcoin near the $6,000 resistance against the US Dollar. BTC price remained in a bearish zone and declined below the $5,200 and $5,000 support levels.
The price even broke the neckline support and settled below the 100 hourly simple moving average. Finally, the price spiked below the $4,500 support and traded as low as $4,354.
It is currently correcting higher and trading above the $5,000 resistance. There was a break above the 50% Fib retracement level of the recent decline from the $5,986 high to $4,354 low.
The current price action is positive, but bitcoin seems to be facing hurdles near the $5,300 area and the 100 hourly SMA. More importantly, there is a major bearish trend line forming with resistance near $5,350 on the hourly chart of the BTC/USD pair.
The 61.8% Fib retracement level of the recent decline from the $5,986 high to $4,354 low is also acting as a resistance. If there is a successful close above the $5,350 resistance and the 100 hourly SMA, the price is likely to continue higher.
An initial resistance is near the $5,600 resistance, above which the price is likely to accelerate higher towards the $5,980 and $6,000 resistance levels. Any further gains is likely to set the stage for a test of the main $6,500 resistance area.
Yet Another Failure?
If bitcoin fails to continue above the $5,350 resistance and the 100 hourly SMA, it is likely to resume its decline. An initial support is near the $5,050 and $5,000 levels.
A clear break below the $5,000 support level could put a lot of pressure on the bulls. In the mentioned case, the price may perhaps continue lower towards $4,500.