Bitcoin Price Consolidates, Why Recovery Could Be Capped

Bitcoin extended losses below the $21,000 support against the US Dollar. BTC is consolidating and any upsides might face hurdles near $21,500.

• Bitcoin remained in a bearish zone and traded below the $21,000 level.
• The price is now trading below the $21,500 level and the 100 hourly simple moving average.
• There is a key bearish trend line forming with resistance near $21,650 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair might correct higher but upsides might be limited above $21,500.

Bitcoin Price Remains In A Bearish Zone

Bitcoin price remained in a bearish zone after it settled below the $22,000 support zone. It consolidated near the $21,000 zone for some time before there were more losses.

The price declined below the $21,000 level but downsides were limited. A low is formed near $20,750 and the price is now consolidating losses. It is now trading below the $21,500 level and the 100 hourly simple moving average.

There was a minor upside above the $21,000 level. The price cleared the 23.6% Fib retracement level of the recent drop from the $22,250 swing high to $20,750 low.

On the upside, bitcoin price could face resistance near the $21,500 level. It is near the 50% Fib retracement level of the recent drop from the $22,250 swing high to $20,750 low. The next key resistance is near the $21,650 zone. There is also a key bearish trend line forming with resistance near $21,650 on the hourly chart of the BTC/USD pair.

Source: BTCUSD on TradingView.com

A close above the $21,650 resistance zone could set the pace for a decent increase. In the stated case, the price may perhaps rise towards the $22,000 level. The next major resistance sits near the $22,500 level.

More Losses in BTC?

If bitcoin fails to start a recovery wave above the $21,500 level, it could continue to move down. An immediate support on the downside is near the $21,000 level.

The next major support now sits near the $20,750 and $20,500 levels. A close below the $20,500 support zone might increase selling pressure and the price might test $20,000 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 near the 50 level.

Major Support Levels – $21,000, followed by $20,750.

Major Resistance Levels – $21,500, $21,650 and $22,000.