Key Points
Major Support Level – $7,200
Major Resistance Level – $7,700
The price of Bitcoin was able to gather some support near $7,260 and bounced back above $7,400 against the US Dollar.
Bitcoin is making an attempt to close above a large bearish trend line with resistance at $7,650 on the hourly chart.
If it can make a successful close above this trend line then it could bring more gains near term.
Bitcoin price is showing positive signs above $7,400 against the US Dollar. BTC must break the $7,650 and $7,700 resistance levels to recover further.
Analysis of Price
There were further bearish moves below $7,500 in bitcoin price against the US Dollar. The BTC/USD pair traded close to the $7,200 support level before buyers appeared. A low was formed at $7,258 from where the price started an upside correction. Buyers succeeded in pushing the price back above the $7,400 resistance, which is a positive sign.
During the recent upside move, the price managed to get above the 23.6% Fib retracement level of the last drop from the $8,593 high to $7,258 low. More important, there was a break above a key connecting bearish trend line with resistance at $7,600 on the hourly chart of the BTC. However, BTC is currently struggling to move above another bearish trend line with resistance near $7,650 on the same chart. A close above $7,650 and $7,700 is required for buyers to gain control. The next major hurdle is near $8,000 and the 50% Fib retracement level of the last drop from the $8,593 high to $7,258 low.
The chart above shows that price is forming a bullish pattern, but it won’t be an easy task for the bulls to clear the $7,700 resistance. If there is a failed attempt at clearing this level we will drop back towards the $7,300 and $7,200 in the near term.
What the Technical Indicators are Showing:
Hourly MACD – The MACD for BTC is back in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI is now well above the 50 level.
