Bitcoin Just Rejected $6,600 and Its Vulnerable To a Short-Term Correction
After a successful close above the $6,000 area, bitcoin price formed a support base against the US Dollar. As a result, BTC price started a steady increase above the $6,200 resistance and the 100 hourly simple moving average.
The price gained pace and traded above the $6,400 pivot area. It is up more than 8% and it even climbed above the $6,500 resistance. A high is formed near the $6,641 level and it seems like the price is struggling to gain strength above $6,600.
Bitcoin is currently correcting lower and trading below the $6,500 level. It broke the 23.6% Fib retracement level of the recent rally from the $5,846 low to $6,641 high.
On the downside, an initial support is near the $6,400 area. There is also a connecting bullish trend line forming with support near $6,420 on the hourly chart of the BTC/USD pair.
Below the trend line support, the price could test the $6,300 area and the 100 hourly SMA. The main support seems to be forming near the $6,240 level. It is close to the 50% Fib retracement level of the recent rally from the $5,846 low to $6,641 high.
If the bulls fail to protect the $6,300 and $6,240 levels, there is a risk of another bearish wave. In the mentioned bearish case, the price could dive towards the $6,000 level.
If bitcoin remains stable above $6,400 or $6,300, it could make another attempt to gain strength above the $6,600 resistance area.
A successful close above the $6,600 level and a follow through above $6,640 may perhaps spark a decent upward move towards the $6,800 and $7,000 resistance levels.