Bitcoin Rallies as Bulls Try to Overcome $40,046 Resistance

May 05, 2022 at 09:49 // Price
Coin Idol
The bitcoin price could retrace to the low of $39,223 and initiate a new uptrend

The Bitcoin (BTC) price retreated after an impressive rally to the high of $40,046. The upside is encountering rejection at the recent high and the 21-day line SMA.

Bitcoin (BTC) Price Long Term Forecast: Bearish

On the downside, the bitcoin price could retrace to the low of $39,223 and initiate a new uptrend. However, if selling pressure continues, bitcoin will retest the previous low at $37,633. 

If the bulls break through the resistance at $40,046, the cryptocurrency will rally above the moving averages. This will prompt Bitcoin to rise to the previous high of $42,000. The bullish momentum will extend to the high at $45,000. Meanwhile, Bitcoin has fallen back to the low of $39,601 as we wrote this article. The largest cryptocurrency could find support above the $39,223 breakout level.

Bitcoin (BTC) Indicator Display  

Bitcoin is at level 47 of the Relative Strength Index for period 14. The cryptocurrency is in the downtrend zone as it could fall down due to the recent rejection. The cryptocurrency price is below the moving averages, which are responsible for the selling pressure. The 21-day line SMA and the 50-day line SMA are sloping downward, indicating a downtrend. BTC/USD will resume its upward momentum when the price bars are above the moving averages.

BTCUSD(Daily Chart).png

Technical Indicators: 

Key resistance levels - $65,000 and $70,000

Key support levels - $60,000 and $55,000

What is the Next Direction for BTC/USD?

Bitcoin has recovered from the recent downtrend, but the uptrend is hindered by the high at $40,046. Currently, the cryptocurrency is in a downtrend. Meanwhile, the downtrend from April 18 has shown a candle body testing the 78.6% Fibonacci retracement level. The retracement suggests that BTC will fall, but will reverse at the 1.272 Fibonacci extension level or the $36,332.10 price level.

BTCUSD(Daily Chart 2).png

Disclaimer. This analysis and forecast are the personal opinions of the author and are not a recommendation to buy or sell cryptocurrency and should not be viewed as an endorsement by CoinIdol. Readers should do their own research before investing funds.

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