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TA: Bitcoin Price Breakdown Looks Real, Why BTC Could Dive Below $35K

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Bitcoin 6
06
May

Bitcoin started a strong decline from the $40,000 resistance against the US Dollar. BTC broke the key $37,500 support to move into a bearish zone.

  • Bitcoin started a strong decline below the $37,500 and $36,500 levels.
  • The price is now trading below $37,500 and the 100 hourly simple moving average.
  • There was a break below a key bullish trend line with support near $39,250 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The pair might accelerate further lower below the $35,000 support zone in the near term.

Bitcoin Price Dives 8%

Bitcoin price struggled to clear the $40,000 resistance zone. BTC formed a high near $40,029 and started a fresh decline. There was a major drop below the $38,500 and $38,000 levels.

There was a break below a key bullish trend line with support near $39,250 on the hourly chart of the BTC/USD pair. The pair even declined below the key $37,500 support and settled below the 100 hourly simple moving average.

Finally, it tested the $35,500 zone and traded as low as $35,407. It is now consolidating losses near the $36,200 level. On the upside, bitcoin price is now facing resistance near the $36,500 level.

The 23.6% Fib retracement level of the downward move from the $40,029 swing high to $35,407 low is also near the $36,500 zone. The next key resistance could be near the recent breakdown zone at $37,500, where the bears might take a stand.

Source: BTCUSD on TradingView.com

The 50% Fib retracement level of the downward move from the $40,029 swing high to $35,407 low is also near the $37,500 zone. To start a fresh increase, the price must settle above the $37,500 level.

More Losses in BTC?

If bitcoin fails to clear the $36,500 resistance zone, it could continue to move down. An immediate support on the downside is near the $36,000 level.

The next major support is seen near the $35,500 level or the recent low. A downside break below the $35,500 support might spark another sharp decline. The next major support could be $34,200.

Technical indicators:

Hourly MACD – The MACD is now gaining pace in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now in the oversold zone.

Major Support Levels – $36,000, followed by $35,500.

Major Resistance Levels – $36,500, $37,200 and $37,500.

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