Here’s Why BTC Could Rally If It Clears This Key Hurdle

Bitcoin price is recovering losses and trading above $40,000 against the US Dollar. BTC is likely to accelerate higher if there is a clear break above the 100 hourly SMA at $42,000.

Bitcoin is showing signs of a decent recovery above the $40,000 level.
The price is now facing resistance near $42,000 and the 100 hourly simple moving average.
There was a break above a major bearish trend line with resistance near $42,000 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair is likely to start a strong rally if it settles above $42,000 and the 100 hourly SMA.

Bitcoin Price Starts Recovery
Bitcoin remained stable above the $36,500 and $38,000 support levels. BTC extended its recovery wave above the $40,000 resistance level and moved into a short-term positive zone.
There was a clear break above the 50% Fib retracement level of the last key decline from the $45,774 swing high to $29,748 swing low. Moreover, there was a break above a major bearish trend line with resistance near $42,000 on the hourly chart of the BTC/USD pair.
The pair is now facing resistance near $42,000 and the 100 hourly simple moving average. The 76.4% Fib retracement level of the last key decline from the $45,774 swing high to $29,748 swing low is also acting as a resistance.

Source: BTCUSD on TradingView.com
A clear break above the $42,000 zone and the 100 hourly simple moving average could open the doors for a larger rally. An immediate resistance is near the $43,200 level. The next major resistance is near the $45,775 level. A close above the $45,775 level could set the pace for a move towards the $48,000 resistance zone.
Fresh Drop in BTC?
If bitcoin fails to clear the $42,000 resistance, there is a risk of a fresh decline. An initial support on the downside is near the $40,000 level.
The first major support is now forming near the $38,000 zone. A downside break below the $38,000 support could start a fresh decline towards the $35,000 support zone in the near term.
Technical indicators:
Hourly MACD – The MACD is slowly losing pace in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now above the 50 level.
Major Support Levels – $40,000, followed by $38,000.
Major Resistance Levels – $42,000, $43,200 and $45,775.

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.