Bitcoin Price Technical Analysis – About Time for a Huge Correction!

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Bitcoin Price Key Highlights

  • Bitcoin price has been on a nonstop climb recently, increasing the odds of a similarly strong correction.
  • The pullback finally took place today, causing bitcoin price to retreat from the $500 major psychological resistance levels as predicted in an earlier article.

Bitcoin price appears to have found support at the 61.8% Fibonacci retracement level on the swing low and high visible on the 4-hour chart, signaling that the rally could resume from here.

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Larger Pullback to Trend Line?

Bitcoin price seems uncertain where to go from here, as an even larger pullback to the rising trend line connecting the recent highs could be possible. Stochastic is on the move down, indicating that sellers are still in control of price action, while RSI is giving the same signal.

Price might not be able to resume its climb until the oscillators are able to reach the oversold levels and turn around, potentially drawing more buyers into the mix. Looking at the longer-term time frames shows that bitcoin price broke above a double bottom neckline resistance around $300-$375, which suggests that this might be the line in the sand for a major pullback.

The 100 SMA lines up with the rising trend line support, adding to its strength as a long-term floor. The short-term moving average is above the longer-term 200 SMA, which confirms that the uptrend is likely to carry on.

However, if bulls are eager to charge at this point, another move back to the previous highs at the $500 psychological barrier could take place. Stronger buying pressure might even lead to a break above this area, putting bitcoin price on track to climbing up to the next major psychological resistance around $550.

Intraday support level – $375

Intraday resistance level – $500

Indicator settings:

  • 100 SMA and 200 SMA
  • Stochastic (8, 3, 3)
  • RSI (14)

Charts from TradingView