Bitcoin Price Crashes 8% and Wipes Weekly Gains, Dips Supported?

Bitcoin price started a sharp decline after trading close to $45,000. BTC is down over 8% but the bulls seem to be active above $40,000.

Bitcoin is showing a few bearish signs from the $44,699 high.
The price is trading below $43,500 and the 100 hourly Simple moving average.
There was a break below a key bullish trend line with support near $43,500 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair could find strong buying interest near the $40,000 zone.

Bitcoin Price Drops Heavily

Bitcoin price remained in a bullish zone after it broke the $40,000 resistance. BTC climbed higher steadily above the $42,000 and $43,000 levels. The price even rallied above $44,000.

However, it failed to test the $45,000 resistance. A high was formed near $44,699 and the price started a sharp downside correction. There was a move below the $44,000 level. Besides, there was a break below a key bullish trend line with support near $43,500 on the hourly chart of the BTC/USD pair.

The pair declined below the 50% Fib retracement level of the upward move from the $39,398 swing low to the $44,699 high. Bitcoin is now trading below $43,500 and the 100 hourly Simple moving average.

However, the bulls are protecting the $40,000 support and the 76.4% Fib retracement level of the upward move from the $39,398 swing low to the $44,699 high. The price is attempting a recovery wave and facing resistance near the $42,400 level.

Source: BTCUSD on TradingView.com

The first major resistance is forming near $43,2000, above which the price might gain bullish momentum and rise toward $44,000. A close above the $44,000 resistance might start a strong upward move. The next key resistance could be near $44,200, above which BTC could rise toward the $45,000 level.

$40K Is The Key For BTC

If Bitcoin fails to rise above the $43,200 resistance zone, it could start another decline. Immediate support on the downside is near the $41,200 level.

The next major support is near $40,500, below which the price might test the $40,000 zone. If there is a move below $40,000, there is a risk of more downsides. In the stated case, the price could drop toward the $38,500 support in the near term.

Technical indicators:

Hourly MACD – The MACD is now gaining pace in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 30 level.

Major Support Levels – $41,200, followed by $40,000.

Major Resistance Levels – $42,400, $43,200, and $44,200.

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