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Bitcoin Price Watch: BTC’s Correction Could Extend To $3,500

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Key Points

  • Bitcoin price struggled to gain pace above the $4,240 level and declined recently against the US Dollar.
  • There was a break below a major bullish trend line with support at $4,020 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The price is currently trading below the $3,850 support and it could decline further towards $3,500.

Bitcoin price started a downside correction below $4,000 against the US Dollar. BTC might continue to move down towards the $3,600 or $3,500 support level.

Bitcoin Price Analysis

Yesterday, bitcoin traded close to the $4,250 level against the US Dollar. The BTC/USD pair struggled to clear the $4,240 level and later started a sharp downside correction. It broke the $4,000 support and the 100 hourly simple moving average. Sellers gained pace and pushed the price below the 61.8% Fib retracement level of the last wave from the $3,788 low to $4,240 high.

More importantly, there was a break below a major bullish trend line with support at $4,020 on the hourly chart of the BTC/USD pair. The pair even broke the $3,788 low and moved into a short term bearish zone. If there are more declines, the price could test the $3,620 support. Below $3,620, the next stop for sellers could be near the $3,500 level. It coincides with the 1.618 Fib extension level of the last wave from the $3,788 low to $4,240 high. On the other hand, if there is an upside correction, the price is likely to struggle near the $3,850 and $3,980 resistance levels.

Looking at the chart, bitcoin price clearly failed near the $4,240 level. BTC price could extend declines below $3,600, but it must stay above $3,500 to start a fresh upward move. If not, it could decline towards the $3,200 support.

Looking at the technical indicators:

Hourly MACD – The MACD for BTC/USD moved back in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI is currently well below the 50 level.

Major Support Level – $3,500

Major Resistance Level – $4,000

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