Bitcoin started an upside correction in the previous week after forming a decent support base above $4,000. Moreover, the price gained momentum above the $4,500 level and traded above the $5,000 resistance.

There was a successful break above the $5,500 resistance which resulted in a sharp upward move above the $6,000 level. However, the rally faced a major barrier around the $7,000 level and the 100 simple moving average (4-hours).

A weekly high was formed near $6,979 and the price started a downward correction. The 23.6% Fib retracement level of the recent uptrend from the $4,328 low to $6.979 high was subsequently broken.

On the downside, bitcoin is finding strong supports near the $5,800 level. Additionally, the 50% Fib retracement level of the recent rally from the $4,328 low to $6.979 high is also acting as a support.

On the upside, a major resistance is seen near the $6,800 level and the 100 simple moving average (4-hours). There is also a formation of key bearish trend line, with resistance around $6,680, on the BTC price’s 4-hours chart. A successful break above the trend line, 100 SMA, and $6,800, could lead to high chances of a solid surge towards the $7,500 and $7,800 levels in the near term.

The major support for bitcoin is currently forming near the $5,800 level. The next major support is also seen at the $5,200 level and a connecting bullish trend line on the same chart. A successful break below the $5,200 support could lead to another decline. In such scenario, the price is likely to revisit the $4,500 and $4,200 support levels.

Technical Indicators

The 4 hours MACD for the BTC price is about to move back into the bullish zone. Its 4 hours RSI (Relative Strength Index) is currently well above the 50 level. Major support level is at $5,800, whereas, major resistance level is also seen at $6,800.