Here’s What Could Trigger A Bullish Reversal Above $40K

Bitcoin price was dumped yesterday by over 20% against the US Dollar. BTC is recovering from $30K and it might attempt a bullish reversal above $40K.

Bitcoin tumbled below the $40,000 and $35,000 support levels.
The price is now trading well below $42,000 and the 100 hourly simple moving average.
There is a crucial bearish trend line forming with resistance near $39,000 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair is likely to start a strong bullish move if there is a break above $40,000.

Bitcoin Price Starts Recovery
Bitcoin failed to stay above the $42,000 and $42,000 support levels. BTC tumbled over 20% and it broke many important supports near $35,000. There was also a spike below the $32,000 support zone.
A low was formed near the $29,750 and the price is now correcting higher. It broke the $35,000 resistance zone. There was also a break above the 50% Fib retracement level of the recent drop from the $45,775 swing high to $29,750 swing low.
However, the price is trading well below $42,000 and the 100 hourly simple moving average. An immediate resistance is near the $39,000 level.
There is also a crucial bearish trend line forming with resistance near $39,000 on the hourly chart of the BTC/USD pair. The trend line is close to the 61.8% Fib retracement level of the recent drop from the $45,775 swing high to $29,750 swing low.

Source: BTCUSD on TradingView.com
A successful break above the trend line resistance could set the pace for a strong move above the $40,000 resistance. The next major resistance is near the $42,000 level. A close above the $42,000 level could set the pace for a strong rally in the coming sessions. The next major resistance sits near the $46,000 level.
Fresh Drop in BTC?
If bitcoin fails to clear the $39,200 and $40,000 resistance levels, there is a risk of a fresh decline. An initial support on the downside is near the $36,000 level.
The first major support is now forming near the $34,000 zone. A downside break below the $34,000 support could start a fresh decline towards the main $30,000 support zone in the near term.
Technical indicators:
Hourly MACD – The MACD is now gaining pace in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is likely to surpass the 50 level.
Major Support Levels – $36,000, followed by $34,000.
Major Resistance Levels – $39,000, $40,000 and $42,000.

Shakira

I’m a professional writer specializing in the field of cryptocurrencies. My work has been published in numerous online and offline publications which has made me one of the leading authorities in this industry. In addition to my work as an author, I’m also a highly sought-after speaker on the topic of cryptocurrency investing. I have given talks at some of the world’s most prestigious financial institutions, and my advice is regularly featured in the media.