Bitcoin price gained traction and broke the $4,000 and $4,080 resistances recently against the US Dollar. BTC/USD is currently consolidating and it must hold the $3,900 uptrend support.
- Bitcoin price traded as high as $4,138 and later corrected lower.
- BTC is following a major ascending channel with support at $3,880 on the 2-hours chart.
- The price must stay above the $3,900 and $3,880 support levels to avoid a downside break.
Bitcoin Price Analysis
In the last analysis, we discussed that bitcoin price is likely to extend gains above the $3,700 resistance zone against the US Dollar. BTC/USD did gain bullish momentum and broke the $3,700, $3,900 and $4,080 resistance levels.
The 2-hour chart indicates that the price surged from the $3,630 low and settled well above the 100 simple moving average (2-hours). The price traded to a new weekly high at $4,138 and later started a downside correction.
The price recently declined below the 23.6% Fib retracement level of the last wave from the $3,630 low to $4,138 high. However, there is strong support formed near the $3,880 and $3,900 levels.
Moreover, there is also a major ascending channel in place with support at $3,880 on the same chart. Finally, the 50% Fib retracement level of the last wave from the $3,630 low to $4,138 high is also near the $3,880 level.
Therefore, as long as the price is above the channel support and $3,880, it remains in an uptrend and it could bounce back above $3,950 and $4,000 in the near term. In the mentioned bullish case, the price may even break the $4,180 barrier and trade towards the $4,440 level.
On the other hand, a downside break below $3,880 could clear the path for an extended downside correction towards the $3,630 swing low. Below $3,630, the price will most likely test $3,510 and the 100 SMA.
Overall, bitcoin price stays in an uptrend as long as it is above $3,880. If it fails, sellers could take back control and push BTC price back towards the $3,630 or $3,510 support.