Despite Bitcoins Key Technical Correction, The 100 SMA Can Trigger A Fresh Rally

Friday 14 February 2020, 3:45 PM AEST - 7 months ago

Bitcoin started a downside correction from the $10,500 area against the US Dollar. BTC declined below $10,200, but it is still holding the key 100 hourly SMA.

  • Bitcoin price failed to climb above $10,500 and corrected lower against the US Dollar.
  • There was a sharp dip below the $10,200 level before the bulls protected the 100 hourly SMA.
  • There is a key contracting triangle forming with resistance near $10,290 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The pair could either rally again above $10,300 or it might extend its decline below the $10,100 support.

Bitcoin Holding Key Support

Recently, bitcoin made another attempt to climb above the $10,500 resistance area against the US Dollar. However, BTC price failed to continue higher and formed a short term top near $10,519.

Later, there was a downside correction below the $10,400 level. Moreover, yesterdays ascending channel with support near $10,360 was breached on the hourly chart of the BTC/USD pair.

Bitcoin PriceBitcoin Price

It opened the doors for more losses and the price spiked below the $10,200 support. It traded close to the $10,000 level, but the 100 hourly simple moving average acted as a strong buy zone.

A swing low is formed near the $10,057 and the price is currently consolidating in a range. Bitcoin recovered above the 23.6% Fib retracement level of the recent drop from the $10,519 high to $10,057 low.

More importantly, there is a key contracting triangle forming with resistance near $10,290 on the same chart. On the downside, the triangle support is near the $10,180 level.

The main support on the downside is near the $10,100 level, below which the price could continue to move down. In the mentioned case, the price is likely to revisit the $9,890 support area in the near term.

Fresh Rally?

On the upside, the triangle resistance is close to the 50% Fib retracement level of the recent drop from the $10,519 high to $10,057 low.

Therefore, an upside break above the $10,300 level

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