Bitcoin Showing Signs of Weakness But 100 SMA Can Trigger New Rally

Bitcoin Showing Signs of Weakness But 100 SMA Can Trigger New Rally

Bitcoin is struggling to gain momentum above the key $7,000 resistance against the US Dollar. BTC is likely to surge past $7,000 as long as it is above $6,400 and the 100 SMA (H4).

Bitcoin price is currently showing a few bearish signs below the $7,000 resistance area.
There is a strong support forming above $6,400 and the 100 simple moving average (4-hours).
There is a key bullish trend line forming with support at $6,425 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).
The pair could make another attempt to surpass the $7,000 and $7,200 resistance levels in the near term.

Bitcoin is Holding Crucial Support
This past week, bitcoin traded higher above the $6,400 and $6,500 resistance levels against the US Dollar. BTC price even spiked above the $7,000 resistance and settled nicely above the 100 simple moving average (4-hours).
It traded as high as $7,273 before starting a downside correction. The price settled below the $7,000 level to start the correction. Besides, there was a spike below the 50% Fib retracement level of the upward move from the $6,150 low to $7,273 high.
The price tested the $6,600 support area and it is currently consolidating in a range. It seems like the 61.8% Fib retracement level of the upward move from the $6,150 low to $7,273 high is acting as a support.
There is also a key bullish trend line forming with support at $6,425 on the 4-hours chart of the BTC/USD pair. More importantly, the 100 simple moving average (4-hours) is near the trend line and the $6,400 support.
Bitcoin Price
If BTC fails to stay above the $6,400 support and the 100 SMA, there is a risk of a significant decline. The next key support is near the $6,000 level, below which it could even test the $5,800 support area.
Upside Break
Bitcoin bulls need to protect the $6,400 support and the 100 SMA for another increase in the near term. On the upside, an initial hurdle is near the $7,000 level.
A successful break above the $7,000 resistance level could spark a strong rally above the $7,200 and $7,270 levels. The next major resistance is near the $7,500 level, above which the price is likely to test the $7,880 level.
Technical indicators
4 hours MACD – The MACD for BTC/USD is slowly moving into the bearish zone.
4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is currently declining towards the 50 level.
Major Support Level – $6,400
Major Resistance Level – $7,000
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