Here Why Bitcoin Bulls Need To Be Very Careful Here: A Big Pullback Is Still Possible

Bitcoin declined to a new weekly low at $9,483 before recovering against the US Dollar. BTC is back above $9,700, but it is still trading below a few key hurdles ($9,950 and $10,000).

• Bitcoin price started an upside correction after trading as low as $9,483 against the US Dollar.
• There are positive signs on the chart, but the bulls need be very careful unless the price breaches $10K.
• There was a break above a key declining channel with resistance near $9,730 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• Ethereum recovered more than 8%, but ripple is still struggling below $0.3000.

Bitcoin Facing Key Hurdles

Yesterday, there was a downside extension in bitcoin price below the $9,600 support against the US Dollar. BTC price even spiked below the $9,500 level and settled well below the 100 hourly simple moving average.

Finally, the price traded to a new weekly low at $9,483 before starting an upside correction. It recovered above the $9,500 and $9,600 levels to start the current recovery wave.

More importantly, there was a break above a key declining channel with resistance near $9,730 on the hourly chart of the BTC/USD pair. Besides, bitcoin price climbed above the 23.6% Fib retracement level of the downward move from the $10,400 high to $9,483 low.

The price is now showing a few positive signs above the $9,700 area and it could continue to recover. However, there are a few key hurdles on the upside near the $9,940 and $10,000 levels.

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The 50% Fib retracement level of the downward move from the $10,400 high to $9,483 low is close to $9,940 to act as the first major resistance. The main resistance is near $10,000 since it is near the 100 hourly simple moving average.

Therefore, a successful break above $9,940 and then a follow up move above the $10,000 handle is needed to start a fresh and renewed uptrend. In the mentioned case, the price could revisit the $10,500 resistance area.

What if the Bulls Fail?

There are chances that bitcoin bulls struggle near $9,940 and $10,000. If they fail to gain strength above $10,000, the price may perhaps resume its decline.

On the downside, the first support is seen near the $9,600 and $9,500 levels. Any further losses might open the doors for a larger downside correction towards $9,000.

Hourly MACD – The MACD is slowly losing pace in the bullish zone.

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

Major Support Levels – $9,600 followed by $9,500.

Major Resistance Levels – $9,940, $10,000 and $10,100.