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Bitcoin Near Crucial Juncture: Why BTC Could Surge Above $18.8K

Bitcoin 2020/11/22 05:28 by Aayush Jindal

Bitcoin price traded to a new multi-month high close to $18,850 against the US Dollar. BTC is now consolidating gains (while ripple surged 35%) and preparing for the next major move.

  • Bitcoin traded above the $18,000 resistance and almost tested the $19,000 level.
  • The price is now consolidating above $18,000 and the 100 simple moving average (4-hours).
  • There is a key contracting triangle forming with resistance near $18,800 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).
  • The pair could either rally further above $18,800 or it might correct lower towards the $17,350 level.

Bitcoin Price is Consolidating Gains

This past week, bitcoin extended its rise above the $17,500 and $18,000 resistance levels against the US Dollar. The BTC/USD pair even cleared the $18,500 level and settled well above the 100 simple moving average (4-hours).

It traded close to the $19,000 level and formed a new multi-month high at $18,853. The price is currently consolidating gains below the $18,800 level, while a few altcoins such as ripple and Ethereum gained bullish momentum.

An initial support for bitcoin sits near the $18,450 level. It is close to the 23.6% Fib retracement level of the upward wave from the $17,344 swing low to $18,853 high.

Bitcoin Price

Source: BTCUSD on TradingView.com

It seems like there is a key contracting triangle forming with resistance near $18,800 on the 4-hours chart of the BTC/USD pair. If there is an upside break above the triangle resistance, the price could start a fresh rally in the coming sessions.

The next immediate resistance is near the $19,000 level. A proper close above the $19,000 level might open the doors for a larger increase towards the $19,400 and $19,550 levels.

Downside Correction in BTC?

If bitcoin fails to clear the $18,800 resistance, it could correct lower. The first key support is near the triangle lower trend line and $18,400.

The next major support is near the $18,000 level or the 50% Fib retracement level of the upward wave from the $17,344 swing low to $18,853 high. Any further losses may perhaps lead the price back towards the $17,350 support zone in the coming days.

Technical indicators

4 hours MACD – The MACD for BTC/USD is slowly losing momentum in the bullish zone.

4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is correcting lower from the 70 level.

Major Support Level – $18,450

Major Resistance Level – $18,800

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