Bitcoin (BTCUSD) has been showing signs of cooling off after surging in the past trading sessions, with the cryptocurrency approaching key Fibonacci retracement levels as it pulls back from its recent rally.
The current price at $92,602 suggests that BTC is finding temporary support at this level, though traders should remain cautious as several technical indicators point to potential further correction.
Key Bitcoin Levels To Watch
The hourly chart shows Bitcoin has established significant Fibonacci retracement levels that could attract bullish pressure as the correction comes in play.
The 38.2% Fibonacci retracement level at $90,631 appears to be providing initial support, while the 50% level at $89,381 represents a more significant zone that could determine the short-term direction. Further below, the 61.8% retracement at $88,131 could serve as the last line of defense before a more pronounced decline toward the 100% level at $84,085.
On the upside, Bitcoin needs to overcome the resistance at $94,677 to regain bullish momentum. A daily close above this threshold could signal the resumption of the uptrend and potentially pave the way toward retesting previous highs.
The long-term ascending trendline visible on the chart has been supporting Bitcoin’s upward trajectory for months, currently intersecting around the $76,000 region. This trendline remains crucial for the overall bullish structure to remain intact.
BTCUSD Technical Indicators Analysis
The moving averages on the chart provide significant insights into the current market structure. The blue line (100 SMA) is still positioned above the red line (200 SMA), suggesting that the longer-term bullish bias remains intact despite the recent pullback. However, the narrowing gap between these two moving averages could be an early warning sign of weakening upward momentum.
The stochastic oscillator (upper indicator panel) is showing a significant downturn from the overbought region, currently heading toward the midline. This suggests diminishing buying pressure and potential for further short-term weakness. The stochastic’s movement indicates that sellers are gaining control, though the indicator hasn’t yet reached oversold territory.
The RSI (lower indicator panel) is also declining, currently hovering around the 50-60 range, coming down from previously overbought conditions. This gradual decline in the RSI confirms the loss of bullish momentum and aligns with the corrective phase Bitcoin is experiencing.
Price Outlook
Bitcoin appears to be undergoing a typical pullback within a broader uptrend. The current price action suggests a period of consolidation or correction might continue in the near term, with the Fibonacci levels providing important reference points for potential reversals.
If Bitcoin holds above the 50% Fibonacci retracement level ($89,381) and the 100 SMA, the bullish scenario remains favored with a potential resumption of the uptrend toward the $94,677 level and possibly higher. A daily close above this resistance could reignite buying interest, potentially leading to a test of the $100,000 psychological barrier in the coming weeks.
However, if Bitcoin breaks below the 61.8% Fibonacci retracement level ($88,131) and the 100 SMA, this could trigger increased selling pressure, potentially extending the correction toward the long-term ascending trendline around $76,000. The behavior of price near the 100 SMA will be particularly revealing about the strength of the current correction.
Traders should watch for reversal candlestick patterns at the key Fibonacci levels, as these could signal the end of the correction phase. Additionally, monitoring volume patterns will provide insights into the conviction behind price movements, with increasing volume on upward moves suggesting stronger bullish sentiment returning to the market.
Given the broader fundamental backdrop of anticipated crypto-friendly policies under the current administration and easing global trade concerns for the time being, there could be scope for more bitcoin upside as risk rallies are sustained.