Tuesday, October 20, 2020

Bitcoin Defies Gravity, But $10,900 Still Presents Strong Resistance

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Bitcoin price is slowly recovering from the $10,387 low against the US Dollar. BTC broke the $10,650 resistance and it might soon test the $10,800 resistance or the $10,900 barrier.

  • Bitcoin started a fresh upward move above the $10,550 and $10,650 resistance levels.
  • The price is up 2%, and it is trading above the $10,700 level and the 100 hourly simple moving average.
  • There is a key rising channel forming with support near $10,650 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The pair is currently showing positive signs, but it is likely to face strong resistance near $10,900.

Bitcoin Price is Facing Hurdles

After a steady decline, bitcoin price found support just above $10,350 against the US Dollar. BTC price traded as low as $10,387 and recently started a fresh upward move.

The bears seem to have lost control, as the price was able to climb above the $10,550 resistance level. There was also a break above the 50% Fib retracement level of the key decline from the $10,930 high to $10,387 low.

Bitcoin is now trading above the $10,650 resistance and the 100 hourly simple moving average. It seems like there is a key rising channel forming with support near $10,650 on the hourly chart of the BTC/USD pair.

Bitcoin Price

Bitcoin price dives below $10,800. Source: TradingView.com

On the upside, the first major resistance is near the $10,800 level. It is close to the 76.4% Fib retracement level of the key decline from the $10,930 high to $10,387 low. The next major resistance is near the $10,850 level, above which the price might attempt another upside break above the $10,900 and $11,000 resistance levels.

A successful close above $10,900 and then a follow up move above $11,000 could start a strong increase in bitcoin in the coming sessions.

Fresh Drop in BTC?

If bitcoin fails to continue higher above the $10,800 resistance or the $10,900 barrier, there is a risk of a fresh drop. An initial support is near the channel lower trend line at $10,650.

The next major support is near the $10,600 level or the 100 hourly simple moving average, below which there are high chances of a fresh dive towards the $10,350 support zone.

Technical indicators:

Hourly MACD – The MACD is showing a few signs of recovery in the bullish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is currently well above the 60 level.

Major Support Levels – $10,650, followed by $10,600.

Major Resistance Levels – $10,800, $10,850 and $10,900.

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