Bitcoin Price Dives Below $40K, Can Bulls Save The Day?

Bitcoin price extended its decline below the $40,000 support zone. BTC is consolidating losses and remains at risk of more downsides below $38,500.

• Bitcoin price is gaining bearish momentum below the $40,500 zone.
• The price is trading below $40,500 and the 100 hourly Simple moving average.
• There is a connecting bearish trend line forming with resistance near $40,850 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair might correct above $40,000 but the bears could remain active near $40,500.

Bitcoin Price Takes Hit

Bitcoin price remained in a bearish zone below the $42,000 support zone. BTC bears gained strength and were able to push the price below the $40,000 support zone.

A new weekly low was formed near $39,451 and the price is now consolidating losses. It is slowly recovering above the $39,800 level. It is approaching the 23.6% Fib retracement level of the recent decline from the $42,260 swing high to the $39,451 low.

Bitcoin is now trading below $40,500 and the 100 hourly Simple moving average. Immediate resistance is near the $40,150 level. The first major resistance is near the $40,850 level. There is also a connecting bearish trend line forming with resistance near $40,850 on the hourly chart of the BTC/USD pair.

Source: BTCUSD on TradingView.com

The trend line is close to the 50% Fib retracement level of the recent decline from the $42,260 swing high to the $39,451 low. A clear move above the $40,850 resistance could send the price toward the $41,250 resistance. The next resistance is now forming near the $42,000 level. A close above the $42,000 level could push the price further higher. The next major resistance sits at $43,000.

More Downsides In BTC?

If Bitcoin fails to rise above the $40,850 resistance zone, it could continue to move down. Immediate support on the downside is near the $39,650 level.

The next major support is $39,500. If there is a close below $39,500, the price could gain bearish momentum. In the stated case, the price could drop toward the $38,500 support in the near term.

Technical indicators:

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

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.

Major Support Levels – $39,500, followed by $38,500.

Major Resistance Levels – $40,500, $40,850, and $41,250.

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