Bitcoin Trims Gains, What Could Trigger Fresh Drop To $35K

Bitcoin price started a fresh decline after it failed to stay above $40,000 against the US Dollar. BTC is moving lower and it could even decline towards $35,000 in the near term.

Bitcoin started a fresh decline from well above the $40,000 pivot level.
The price is now trading well below $39,000 and the 100 hourly simple moving average.
There is a major bearish trend line forming with resistance near $38,500 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair is likely to continue lower if it fails to stay above the $37,200 support zone.

Bitcoin Price Extends Decline
Bitcoin failed to stay above the key $40,000 support zone and started a fresh decline. BTC broke the $39,500 and $38,500 support levels to move into a short-term bearish zone.
The price traded below the 50% Fib retracement level of the upward move from the $34,822 swing low to $41,380 swing high. It is now trading well below $39,000 and the 100 hourly simple moving average. There is also a major bearish trend line forming with resistance near $38,500 on the hourly chart of the BTC/USD pair.
An immediate support on the downside is near the $37,200 level. It is near the 61.8% Fib retracement level of the upward move from the $34,822 swing low to $41,380 swing high.

Source: BTCUSD on TradingView.com
If there is a downside break below the $37,200 support, the price may even struggle to stay above the $36,500 support. Any more losses could open the doors for a move towards the $35,000 support zone in the near term.
Fresh Increase in BTC?
If bitcoin stays above the $37,200 support, it could start a fresh increase. An initial resistance on the upside is near the $38,200 level.
The first major resistance is near the $38,500 level and the bearish trend line. A successful break above the trend line could lead the price towards the $39,500 resistance zone and the 100 hourly SMA. A close above the 100 hourly SMA is must for a fresh increase above the $40,000 resistance zone in the coming sessions.
Technical indicators:
Hourly MACD – The MACD is slowly moving into the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now well below the 50 level.
Major Support Levels – $37,200, followed by $36,500.
Major Resistance Levels – $38,200, $38,500 and $40,000.

Ericka Turcotte

I have worked in the financial sector for over 10 years and have a keen interest in cryptocurrency. I have been writing about crypto for the past two years and have become one of the most respected authors in the space. I have a deep understanding of how this new asset class works and am able to provide insights that are both interesting and useful to my readers.