Bitcoin Shows Early Recovery Signs After Recent Drop, Eyes Key Resistance Levels
After a period of significant volatility, Bitcoin's price appears to be stabilizing, with early indicators suggesting a potential recovery. The digital asset is currently making efforts to reclaim crucial resistance zones following a notable dip.
Price Action and Key Levels
Bitcoin initiated a fresh recovery wave above the $108,000 resistance level, successfully surpassing the $107,500 and $108,500 marks. While it briefly tested $111,800, it struggled to maintain momentum above the $111,500 level and the 61.8% Fibonacci retracement of the recent decline from $115,975 to $103,582. Currently, BTC is trading above $109,000 and the 100 hourly Simple Moving Average, with a bullish trend line forming support around $108,800 on the hourly chart. Should Bitcoin sustain its upward trajectory and break above $110,500 and the first key resistance at $111,200, it could target the $112,500 resistance, with further gains potentially pushing it towards the $113,200 and $115,000 levels.
Potential for Further Decline
Despite the nascent recovery, a failure to clear the $110,000 resistance zone could trigger another downturn. Immediate support is identified near $108,800 and the aforementioned trend line. The first major support lies at $108,000, followed by the $107,550 zone. A breach below these levels might see Bitcoin slide towards $106,500. A more significant breakdown below the main support at $105,500 could negate the recovery outlook, making it challenging for BTC to bounce back in the short term.
Technical Outlook
The hourly Moving Average Convergence Divergence (MACD) is showing bearish momentum, indicating that sellers still hold some sway. Similarly, the Relative Strength Index (RSI) for BTC/USD is currently below the 50 level, reinforcing the cautious sentiment. Key support levels to watch are $108,800 and $108,000, while critical resistance levels are at $110,500 and $111,500, which must be overcome for a sustained bullish move.
