Key Points

Bitcoin price slowly recovered after trading as low as $6,249 against the US Dollar.

There is a bearish flag forming with current resistance at $6,600 on the hourly chart of the BTC/USD pair (data feed from Kraken).

The pair is likely to face heavy selling interest near the $6,600 and $6,620 resistance levels.

Bitcoin price recovered above the $6,420 level against the US Dollar. However, BTC/USD buyers are likely to struggle near the $6,620 resistance zone.

Bitcoin Price Analysis

Yesterday, we saw a monster decline from well above the $7,000 level in bitcoin price against the US Dollar. The BTC/USD pair traded close to the $6,240 level and formed a low at $6,249. Later, the price started an upward move and corrected above the $6,300 and $6,420 levels. There was also a break above the 23.6% Fib retracement level of the last key drop from the $6,990 high to $6,249 low.

However, the price is currently facing resistance near the $6,530 level. More importantly, there is a bearish flag forming with current resistance at $6,600 on the hourly chart of the BTC/USD pair. On the upside, there is a strong resistance forming near the $6,600-6,620 zone. It represents the 50% Fib retracement level of the last key drop from the $6,990 high to $6,249 low. Additionally, there is a connecting bearish trend line in place with resistance near $6,615. Therefore, the $6,600-6,620 resistance area clearly holds a lot of significance.

Looking at the chart, bitcoin could correct further, but it may possibly struggle to break $6,620. If it moves down and breaks the bearish flag support at $6,390, there might be more losses. In this case, the price may well break the $6,249 low to test the $6,100 support zone in the near term.

Looking at the technical indicators:

Hourly MACD – The MACD for BTC/USD is likely to move back in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI is currently just near the 50 level.

Major Support Level – $6,390

Major Resistance Level – $6,620