The Declining Bitcoin Price and the Potential for Further Losses

The Declining Bitcoin Price and the Potential for Further Losses

Bitcoin price faced significant resistance at the $43,750 level and is now experiencing a decline. This article will analyze the current market trends and explore the potential for further losses if the price drops below the $41,800 level.

Bitcoin price is slowly moving lower from the resistance zone of $43,750. It is currently trading below $42,800 and the 100 hourly Simple Moving Average (SMA). The decline was triggered by a break below a connecting bullish trend line with support near $42,500. If the price fails to hold above the $41,800 level, further losses can be expected.

Bulls Failing to Push the Price Higher

Bitcoin price attempted to gain momentum above the $42,500 resistance zone and even cleared the $43,500 resistance. However, the bulls faced strong resistance near the $43,800 zone and failed to push the price higher. The bears took control, resulting in a fresh decline below the $43,000 level. Furthermore, the break below the connecting bullish trend line indicates a weakening bullish sentiment.

Bitcoin price formed a low near $41,888 and is currently consolidating losses. Immediate resistance is expected near the $42,350 level, which is near the 23.6% Fibonacci retracement level of the downward move from the $43,742 swing high to the $41,888 low. The subsequent key resistance could be at $42,800, or the 50% Fibonacci retracement level. A successful break above these resistance levels could initiate a decent increase, with the next target for the bulls being $43,200.

Further Resistance Levels and Potential Upside

A clear move above the $43,200 resistance is crucial for Bitcoin price to aim for the $43,800 resistance. If this is achieved, the next resistance level forms around $44,200. A close above the $45,000 level could lead to further upward movement, with the next major resistance sitting at $46,500.

Downside Scenario and Key Support Levels

If Bitcoin fails to surpass the $42,800 resistance zone, it may continue its downward trajectory. The first immediate support on the downside is around the $41,800 level, followed by $41,200. However, the main support level that traders should closely monitor is at $40,950. A close below this level could trigger bearish momentum, potentially dragging the price towards the significant support at $40,000.

Technical Indicators

Looking at the technical indicators, the hourly Moving Average Convergence Divergence (MACD) shows a loss of pace in the bearish zone. The Relative Strength Index (RSI) for BTC/USD is also below the 50 level, indicating bearish sentiment. These indicators suggest that caution should be exercised when making investment decisions.

Bitcoin price is facing significant resistance and is currently in a state of decline. A break below the $41,800 support level could potentially trigger further losses. On the other hand, a successful break above the resistance levels can pave the way for a possible recovery. It is crucial for traders and investors to conduct thorough research and assess the risks involved before making any investment decisions.

Analysis

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