Bitcoin Just Reversed and $8,400 Is Imminent, Here’s Why
This past week, bitcoin started a steady rise above the $8,700 and $8,880 resistance levels against the US Dollar. BTC price gained traction and it even managed to climb above the key $9,000 resistance.
However, the bulls faced a strong resistance near the $9,200 area and the 100 simple moving average (4-hours). There is also a crucial bearish trend line forming with resistance near $9,122 on the 4-hours chart of the BTC/USD pair.
It seems like bitcoin failed to clear the trend line, $9,200, and the 100 SMA. As a result, there was a sharp decline below the $9,000 support level. The price is down around 4% and it even declined below the 50% Fib retracement level of the upward move from the $8,402 low to $9,212 high.
It is now trading below the $8,800 level and testing the 61.8% Fib retracement level of the upward move from the $8,402 low to $9,212 high.
If the bulls fail to protect the $8,700 support level, there is a risk of another decline. An initial support is near the $8,600 level, below which there is a risk of a drop towards the $8,400 support area.
If the $8,700 support remains intact, bitcoin price might correct higher above $8,800. An initial resistance on the upside is near the $8,950 level, above which the bulls could aim a break above the trend line.
If there is a clear break above the trend line and the $9,200 resistance, the price might start a strong rally towards the $9,500 and $9,800 levels in the near term. Overall, the trend is now negative and the price might slide further towards $8,400.