Bitcoin Price Nosedives $5K, Why BTC Could Extend Losses

Bitcoin price started a sharp decline after it broke the $60,000 support zone against the US Dollar. BTC is correcting gains, but it is likely to face sellers below $58,000.

• Bitcoin declined heavily below the $60,000 and $58,000 support levels.
• The price is now trading well below $58,000 and the 100 simple moving average (4-hours).
• There was a break below a key bullish trend line with support near $62,000 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).
• The pair is correcting losses, but it might face resistance near $58,000 and $60,000.

Bitcoin Price is Down 12%

This past week, bitcoin price saw a decent increase above the $62,000 resistance against the US Dollar. The BTC/USD pair traded to a new all-time above $64,000 and it settled above the 100 simple moving average (4-hours).

However, there was a substantial downside correction from well above $62,000 in the past few sessions. The price declined heavily below the $60,000 and $58,000 support levels.

The bears were able to push the price below the $55,000 support zone and the 100 simple moving average (4-hours). A low is formed near $51,132 and the price is now correcting higher. It broke the $52,000 and $53,200 resistance levels.

Source: BTCUSD on TradingView.com

Bitcoin cleared the 23.6% Fib retracement level of the recent decline from the $62,692 high to $51,132 low. The price is now facing resistance near the $55,500 and $56,000 levels.

The first major resistance is near the $57,000 level. It is near the 50% Fib retracement level of the recent decline from the $62,692 high to $51,132 low. The main resistance is now forming near the $58,500 level, above which the price might start a fresh increase.

More Losses in BTC?

If bitcoin fails above the $56,000 level, there is a risk of more losses. The first major support is near the $55,000 and $54,800 levels.

The next major support is near the $53,800 level. Any more losses might call for a fresh drop towards the $52,000 support levels. In the stated case, there are even chances of a drop towards the main $50,000 support zone in the near term.

Technical indicators

4 hours MACD – The MACD for BTC/USD is gaining momentum in the bearish zone.

4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is now well below the 40 level.

Major Support Level – $53,800

Major Resistance Level – $57,000