Bitcoin holds key support, why BTC is still facing the risk of a sharp decline

Bitcoin retested the $55,500 support area against the U.S. dollar. BTC is recovering, but may face strong selling interest close to US$57,500 in the short term.

  • Bitcoin closed below key resistance levels of $58,000 and $57,500.
  • The price is now below $57,500 and the 100-hour simple moving average.
  • On the hourly chart of the BTC/USD currency pair (data feed from Kraken), there is a major bearish trend line formed with resistance near 58,000 USD.
  • The currency pair is recovering, but the upside above the resistance zone of $57,500 may be limited.

Bitcoin price is still at risk

Bitcoin price starts New decline From the $59,500 area. BTC rose below the $58,500 and $57,500 support levels and entered a bearish zone.

The decline accelerated below the $56,500 level, and the price retested the $55,500 support area. A low was formed near $55,633, and the price is now correcting losses. It broke through the level of 56,500 USD. The price climbed from a swing high of $59,411, a low of $55,633, to above the 23.6% Fibonacci retracement level.

However, the price of Bitcoin is now below $57,500. 100 hour simple moving averageOn the hourly chart of the BTC/USD currency pair, there is also a major bearish trend line formed, and the resistance is near 58,000 USD.

Source: BTCUSD on TradingView.com

The immediate support is near $56,500. The first major support level is now formed near $55,500. A fall below the $55,500 level may trigger more losses. Under the above circumstances, the price may fall to the level of US$55,000. In the short term, any more losses could cause the price to rise to the $52,000 support area.

Bitcoin’s upper limit?

If Bitcoin remains above the $56,500 support level, it may try a new wave of recovery. On the bright side, the initial resistance is around 57,200 USD. The first key resistance is near 57,500 USD.

It is close to the 50% Fibonacci retracement level that moved down from the swing high of $59,411 and the low of $55,633. The next major resistance is near the US$58,000 and the 100-hour simple moving average, above which the price may rise to the US$60,000 level.

Technical index:

Hourly MACD – MACD is slowly entering the bullish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is still below the 50 level.

The main support levels – 56,500 USD, then 55,500 USD.

The main resistance levels – 57,500 USD, 58,000 USD and 60,000 USD.

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