The price of BTC/USD touched $4225 on February 24th, before generating bearish divergence in the medium-term and breaking down. The price is currently trading slightly above the short-term moving averages which are in the process of making a bullish cross. Price has been following the ascending support line for roughly the past 22 days. Since the drop, the price has struggled to retrace above the 0.382 fib line at $3980.
- There is major resistance near $4400.
- Price is following an ascending support line currently at $3900.
- There are minor support areas near $3800 and $ 3700.
- There is short-term significant resistance at the 0.5 fib line at $4000.
Bitcoin Price Analysis – BTC/USD – 2 Hours Chart
A look at the 2-hour chart shows us that after touching $4250, price sharply broke down and created a bearish engulfing candle on very significant volume. The breakdown was preceded by bearish divergence in both the RSI and the MACD. After the drop, the price fell all the way to the ascending support line that has been in place for roughly 22 days. It is currently trading at $3925. I am choosing to ignore the flash-crash below the line since most of it is a wick and price resumed normal trading shortly thereafter. In a highly volatile market, these things are likely to happen.
As for the indicators, the price is trading slightly above the 21-period moving average, which is getting ready to make a bullish cross with the 50-period MA (second black arrow). The RSI is at 54, indicating neither overbought nor oversold conditions and there is no divergence. Finally, the MACD is moving upward with strength and is very close to turning positive.
BTC/USD – Price Analysis – 15 Minutes Chart
A look at the 15-minutes chart shows that after the drop, the price has been struggling to break above the 0.382 fib line which is at $3980, even though it has been trying for the past 3 days and 20 hours. There is significant resistance at $4000, formed by previous support and the 0.5 fib line. While price is not following a support line, it has created a support area near $3880.
Again I am choosing to ignore the flash crash for the reasons outlined above. As for the resistance area, it is possible that price is following a descending resistance line which has however only been validated twice. If price breaks down from the support area, the next one will be found near $3830, which would make it a triple bottom scenario.
As for the indicators, the RSI is at 57, after a pullback from briefly trading in the overbought range.