Bitcoin Showing Early Signs of Fresh Decline, But $40K Is the Key
- Teresa Bach
- March 4, 2022
- 0 Comments
Bitcoin started a downside correction and traded below $42,000 against the US Dollar. BTC must stay above $40,000 to avoid a trend reversal.
Bitcoin started a fresh decline below the $43,000 and $42,000 levels.
The price is trading below $43,000 and the 100 hourly simple moving average.
There was a break below a major bullish trend line with support near $42,500 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair might correct further, but the $40,000 support is the key.
Bitcoin Price Breaks Support
Bitcoin price failed to stay above the $43,000 support zone. BTC extended decline and traded below the $42,500 support level.
There was a move below the 23.6% Fib retracement level of the key increase from the $37,030 swing low to $45,350 high. Besides, there was a break below a major bullish trend line with support near $42,500 on the hourly chart of the BTC/USD pair.
Bitcoin is now trading below $43,000 and the 100 hourly simple moving average. It is testing the $41,200 support level. It is also near the 50% Fib retracement level of the key increase from the $37,030 swing low to $45,350 high.
If the price stays above the $41,200 support, it could attempt a fresh increase. On the upside, an initial resistance is near the $42,000 level. The first key resistance is near the $42,500 level and the 100 hourly simple moving average.
Source: BTCUSD on TradingView.com
A clear move above the $42,500 resistance might set the pace for a fresh increase. In the stated case, the price could surpass the $43,000 resistance zone. The next major resistance for the bulls may possibly be near the $44,200 level.
More Losses in BTC?
If bitcoin fails to clear the $42,500 resistance zone, it could continue to move down. An immediate support on the downside is near the $41,200 zone.
The next major support is seen near the $40,200 level. The main support is still near the $40,000 level. If there is a downside break below the $40,000 support, the price might start a major decline.
Hourly MACD – The MACD is now gaining pace in the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now near the 30 level.
Major Support Levels – $41,200, followed by $40,000.
Major Resistance Levels – $42,000, $42,500 and $43,000.