Bitcoin price starts constructive correction, why BTC may fall further

Bitcoin price traded to a new monthly high of $21,469 before starting a downside correction. BTC may fall towards $20,600 before starting another rally.

• Bitcoin gained momentum above the $21,000 resistance zone before meeting sellers.
• The price is trading above $20,500 and the 100 hourly simple moving average.
• An important bearish trend line is forming with resistance near $21,150 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair could make another rise if it clears the $21,150 and $21,400 resistance levels.

Bitcoin price corrects lower

Bitcoin price held well above the $20,600 and $20,500 levels. BTC gained momentum on a move above the $21,000 resistance zone and a close above the 100 hourly simple moving average.

The price even moved above the $21,200 level. A high was formed near $21,469 before the bulls lost control. Recently, there was a downside correction below the $21,200 level. The price fell below the 23.6% Fib retracement level of the upward move from the $20,050 swing to the $21,469 high.

However, the bulls were active near the $20,900 zone and the 100-hour simple moving average. Bitcoin price is now trading above $20,500 and the 100 hourly simple moving average.

On the upside, an immediate resistance is near the $21,050 level. The first major resistance is near the $21,150 level. There is also an important bearish trend line forming with resistance near $21,150 on the hourly chart of the BTC/USD pair.

Source: BTCUSD on TradingView.com

A clear move above the trendline resistance and $21,200 could send the price towards $21,500. The next major resistance is near $22,000, above which the price may rise towards the $22,500 zone.

More losses in BTC?

If bitcoin fails to break above the $21,150 resistance zone, it could resume its decline. An immediate support on the downside is near the $20,850 zone and the 100-hour simple moving average.

The next major support is near the $20,600 zone. A clear move below the $20,600 support could push the price further down. In this case, the price might drop towards the $20,200 level.

Technical indicators:

Hourly MACD – MACD is now picking up speed in the bearish zone.

Hourly RSI (Relative Strength Index) – RSI for BTC/USD is now below the 50 level.

Major support levels – $20,600, followed by $20,200.

Major resistance levels – $21,150, $21,400 and $22,000.