Bitcoin Price Analysis: How BTC/USD Dump To $7,200 Could Kick Start Rally To $9,000?

Bitcoin

  • Bitcoin price is struggling to clear the resistance at $8,000 again after the rejection at $8,200 on Tuesday.
  • BTC/USD price is anticipated to drop further before formidable support is found to sustain a reversal.

Bitcoin price crossed above the $8,000 resistance on Monday and extended the leg to $8,200. However, the bears were not amused by the move as they quickly gathered to force BTC/USD back into the $7,000’s range. Consequently, another recovery is underway with the Bitcoin price already advanced above $7,900.

BTC/USD is teetering at $7,930 as the bulls gradually build a bullish momentum to clear the resistance at $8,000. The daily chart shows that in spite of the dive from levels above $9,000 to $7,603, Bitcoin price is still holding above a 15-month ascending trendline. Although the price seems to have found a balance at $7,600, the trendline support was not tested. This could explain why recovery on Tuesday was rejected at $8,200, forcing Bitcoin bulls to go back to the drawing board.

BTC/USD daily chart

BTC/USD price chart
BTC/USD price chart by Tradingview

It is likely that a drop to $7,200 would allow more buyers (most of whom are still skeptical of BTC/USD stability above $7,600) to enter the market increasing the volume and buying activities. A rally is, therefore, expected to emanate from the region at $7,200 with intensified pressure, strong enough to clear the key hurdles at $8,200 and $8,800. Trading above $9,000 would greatly improve sentiments towards BTC especially with 2020 halving less than two months away.

At the moment, the MACD shows that sellers are still present and their influence likely to be felt in the coming sessions on Wednesday. Besides, the gap between the 21 SMA and the 50 SMA hints that selling activities are yet to ousted.

Bitcoin Key Levels

Spot rate: $7,930

Relative change: 31.51

Percentage change: 0.40%

Support: $7,600 and $7,200

Resistance: $8,200 and $8,800