Bitcoin Is Forming a Double Top At $6,000, And Now At Risk Of a Big Drop
After a massive decline, bitcoin price recovered above $5,000 and $5,500 against the US Dollar. BTC price seems to be forming a decent support base above the $5,000 level, but it is also facing hurdles near the 100 hourly simple moving average.
It also settled above the 23.6% Fib retracement level of the main decline from the $7,988 high to $3,935 low. During the recent rise, there was a break above a connecting bearish trend line with resistance at $5,325 on the hourly chart of the BTC/USD pair.
However, bitcoin price struggled to continue above the $6,000 resistance. The price made two attempts to climb above the $6,000 barrier, but it failed. The 50% Fib retracement level of the main decline from the $7,988 high to $3,935 low is also acting as a hurdle.
It seems like there is a double top pattern forming near the $6,000 resistance area. If there is a downside break below the $5,100 and $5,000 support levels, the bears are likely to take control.
The next support is near the $4,800 level, below which the price is likely to extend its decline towards the $4,400 level in the near term.
Chances of an Upside Break
If bitcoin remains well bid above the $5,000 support area, it could make another attempt to surpass $6,000. There is also a key bearish trend line is forming with resistance near $5,650 on the same chart.
A successful break above the trend line, the 100 hourly SMA, and the $6,000 barrier is must to start a strong upward move towards $6,500 in the coming sessions.