Bitcoin faces a crucial test at $100000 and 38.2% Fibonacci retracement for relief bounce potential.
RSI divergence suggests weakening momentum and possible price correction after recent highs near $112000.
Key support zones between $98000 and $100000 converge with trendlines making them critical for price direction.
Bitcoin's price currently sits near $103,248 after a noticeable pullback on the 4-hour chart. Technical analysis suggests critical support may emerge around the 38.2% Fibonacci retracement level near $98,084 and a psychological $100,000 mark. Analysts observe that a relief bounce may depend on Bitcoin's reaction at these points. Meanwhile, the Relative Strength Index (RSI) is signaling divergence, hinting at potential shifts in momentum unseen in price action for some time.
Source: X
This analysis arrives as Bitcoin navigates complex chart patterns reflecting both past corrections and potential future movements. The highlighted Fibonacci levels, coupled with trendline support, set the stage for the next price phase. As the cryptocurrency markets watch closely, the key question remains: Will Bitcoin hold these support levels to sustain its bullish trajectory?
Fibonacci Retracement and Price Support Zones
Bitcoin's price action is currently testing crucial Fibonacci retracement levels. The 38.2% retracement at approximately $98,084 serves as the first significant support zone. Should this level hold, it may trigger a relief bounce and renewed buying interest. Below this, the 50% Fibonacci level sits near $93,690, followed by the 61.8% retracement at $89,297. These levels represent potential areas for buyers to step in and stabilize the price.
The chart also indicates a recent pullback phase beginning after reaching highs near $112,309.72. A descending channel suggests Bitcoin might retest the lower Fibonacci zones or consolidate near the $100,000 psychological level. Observers note that the area between $98,000 and $100,000 will be critical in determining the next move.
Further, a green ascending trendline dating back to previous lows offers additional support. This trendline intersects the Fibonacci levels, reinforcing the importance of this price range. The convergence of these technical signals increases the probability of a meaningful market response.
RSI Divergence Signals Momentum Shift
The 14-period Relative Strength Index (RSI) on the 4-hour chart currently hovers near 30, indicating an oversold condition. More notably, RSI has displayed divergence for a prolonged period, suggesting a disconnect between price trends and momentum. While Bitcoin's price hit new highs, RSI did not follow, signaling weakening strength behind the rally.
Divergence often precedes corrective moves or trend reversals. In this case, it suggests the recent pullback may be part of a healthy correction rather than the start of a deeper decline. However, traders will monitor RSI levels closely, especially if the index dips below 30, to assess potential oversold bounces.
Technical analysts view this divergence as a cautionary sign that momentum is waning, but it also opens the possibility for a rebound if support holds. The RSI behavior adds an essential layer to the overall Bitcoin price structure, informing decisions based on momentum alongside price levels.
Chart Patterns Reflect Market Cycles
The Bitcoin chart also shows two distinct rounded patterns linked to previous market phases. The first covers the late 2020 to early 2021 pre-pump and correction cycle. This pattern aligns with the parabolic run and subsequent retracement seen in that period. The second rounded formation extends into the current cycle, suggesting a possible repetition or continuation of past behaviors.
These rounded bottoms signal accumulation zones where buyers have historically entered the market before large upward moves. The price has recently approached a peak around $112,309, mirroring previous cycles' completion phases. This historical context is vital for interpreting current price dynamics.
Additionally, a descending channel overlays the chart, indicating a consolidation range within the broader uptrend. This channel's resistance could limit near-term gains unless broken decisively. The interplay of these chart features provides a comprehensive technical picture shaping Bitcoin's near-term outlook.
