Bitcoin Bulls Fight to Hold $BTC Above Key Support Levels

Perhaps due in part to the continued war of words between the US and China over trade, the Bitcoin price has failed to maintain its recovery and is trading sideways. One major trendline and one major support level are all that prevent Bitcoin from a further big dip to the downside.

Could $BTC start to gain strength against gold?

Bitcoin continues to look weak as gold and silver show amazing strength during this current period of sometimes intense uncertainty as President Trump ramps up and then cools down the war of words with China.

This said, both gold and silver are heavily overbought now while Bitcoin is becoming oversold. Could Bitcoin finally start to recover from here?

Source: TradingView

The BTC/XAU chart in the daily time frame puts things into perspective. Yes, BTC/XAU has just crashed out of the descending channel, a very bearish turn of events, but the breakdown has not been confirmed yet. Also, the ratio has just encountered a strong support level at 26 oz, while an even more robust support level is just below at 24.6 oz. Given that the daily Stochastic RSI indicators have hit the bottom, it might be expected that the Bitcoin/gold ratio might start to turn in Bitcoin’s favour from here.

Is $BTC about to drop to last key support level?

Source: TradingView

The 4-hour chart for the $BTC price shows that the bears look to have succeeded in flipping the $112,000 level into resistance. At the same time, the price is now tracking sideways under the major trendline. This is not a good turn of events and could herald a drop to the last major support at $108,000.

The Stochastic RSI indicators are heading up, but if this bearish price action continues they would turn back around and head to the bottom, perhaps getting there at the same time as the price reaches the major support level. 

Could this then signal the bottom? Quite possibly, as Bitcoin would become very oversold. That said, if the Trump/China trade war hits another bad moment this could be enough to send Bitcoin even lower.

200-day SMA could be last line of support

Source: TradingView

The daily time frame draws attention to how the $BTC price is teetering below what is now horizontal resistance at $112,000, with a fall to the last major support at $108,000 a real possibility. 

The 200-day simple moving average (SMA) has come into play already, acting as support for last Friday’s crash. It may well be that this moving average becomes support once again, especially as it converges with the $108,000 horizontal level.

Ascending trendline has to hold

Source: TradingView

The weekly time frame for the $BTC price says it all. The ascending trendline has to hold in order for the uptrend to survive. Yes, there is the possibility that the price could fall through the trendline and even dip below the $108,000 major support level, but it would have to be bought back up again to avoid going into a potential tail spin that could drag the crypto market into the next bear market. This week’s close is crucial.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.