Bitcoin price started a fresh increase after a drop towards $53,000 against the US Dollar. BTC is now forming an inverse head and shoulders, with chances of a break above $58,000.
After a sharp decline, bitcoin found support above the $53,000 level. BTC traded as low as $53,222 and recently started a fresh increase. It cleared the $54,200 and $55,000 resistance levels.
There was a recovery above the 23.6% Fib retracement level of the downward move from the $61,695 high to $53,220 low. The price even climbed above the $56,000 level. However, the price is facing resistance near $58,000 and the 100 hourly simple moving average.
It seems like there is a possible inverse head and shoulders pattern forming with resistance near the $57,000 level. There is also a key bearish trend line forming with resistance near $58,000 on the hourly chart of the BTC/USD pair.
Source: BTCUSD on TradingView.com
The trend line is close to the 50% Fib retracement level of the downward move from the $61,695 high to $53,220 low. A successful break above the trend line resistance could open the doors for a decent increase towards the $58,800 and $60,000 levels.
If bitcoin fails to correct higher above the $57,000 and $58,000 resistance levels, it could start a fresh decline. The first key support on the downside is near the $55,000 level.
The next key support is near the $54,200 level. If there is a clear break below the $54,200 level, the price is likely to continue lower in the coming sessions. The next major support is near $53,200, below which the bears might aim a test of the $50,000 support level.
Technical indicators:
Hourly MACD – The MACD is slowly gaining momentum in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is struggling to stay above the 50 level.
Major Support Levels – $55,000, followed by $54,200.
Major Resistance Levels – $57,000, $57,500 and $58,000.
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