Bitcoin price is recovering losses and trading above $40,000 against the US Dollar. BTC is likely to accelerate higher if there is a clear break above the 100 hourly SMA at $42,000.
Bitcoin is showing signs of a decent recovery above the $40,000 level.
The price is now facing resistance near $42,000 and the 100 hourly simple moving average.
There was a break above a major bearish trend line with resistance near $42,000 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair is likely to start a strong rally if it settles above $42,000 and the 100 hourly SMA.
Bitcoin Price Starts Recovery
Bitcoin remained stable above the $36,500 and $38,000 support levels. BTC extended its recovery wave above the $40,000 resistance level and moved into a short-term positive zone.
There was a clear break above the 50% Fib retracement level of the last key decline from the $45,774 swing high to $29,748 swing low. Moreover, there was a break above a major bearish trend line with resistance near $42,000 on the hourly chart of the BTC/USD pair.
The pair is now facing resistance near $42,000 and the 100 hourly simple moving average. The 76.4% Fib retracement level of the last key decline from the $45,774 swing high to $29,748 swing low is also acting as a resistance.
Source: BTCUSD on TradingView.com
A clear break above the $42,000 zone and the 100 hourly simple moving average could open the doors for a larger rally. An immediate resistance is near the $43,200 level. The next major resistance is near the $45,775 level. A close above the $45,775 level could set the pace for a move towards the $48,000 resistance zone.
Fresh Drop in BTC?
If bitcoin fails to clear the $42,000 resistance, there is a risk of a fresh decline. An initial support on the downside is near the $40,000 level.
The first major support is now forming near the $38,000 zone. A downside break below the $38,000 support could start a fresh decline towards the $35,000 support zone in the near term.
Technical indicators:
Hourly MACD – The MACD is slowly losing pace in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now above the 50 level.
Major Support Levels – $40,000, followed by $38,000.
Major Resistance Levels – $42,000, $43,200 and $45,775.