Bitcoin price is consolidating around 5/8 Murray and below the 200 EMA and below the 21 SMA with a slightly bearish bias.
Since February 10, BTC has formed a downtrend channel when it reached the high of 45,811. Since then, it continues with a technical correction and is now approaching the psychological level of $40,000.
Bitcoin price is currently correcting after failing to break through the 200 EMA on the daily chart located at 46,330.
Bitcoin price made a 40% gain between Jan 24 and Feb 10 and tested the weekly supply zone that stretches from 45,500 (7/8) to 51,860 (8/8). This led BTC to drop forming a bearish channel on the 4-hour chart.
The recent rejection at the weekly resistance zone is likely to push BTC lower to the demand zone. A daily close below 39,500 will cause an acceleration to the downside towards 4/8 Murray at 37,500 and drop as low as 34,375.
The eagle indicator is giving a negative signal and the downward pressure is likely to continue in the coming days. On the other hand, a technical bounce above the psychological level of 40,000 could ease the decline.
Our trading plan for the next few hours is to wait for a technical bounce around the psychological level $40,000 to buy with targets at 41,798 and 43,500 below Murray's 6/8.
Support and Resistance Levels for February 18 - 21, 2022
Resistance (3) 43,750
Resistance (2) 43,157
Resistance (1) 41,661
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Support (1) 40,503
Support (2) 38,768
Support (3) 37,500
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Scenario
Timeframe H4
Recommendation: buy if rebound
Entry Point 40,000
Take Profit 41,798; 43,500
Stop Loss 39,300
Murray Levels 43,750 (6/8), 40,625(5/8), 37,500 (4/8), 34,375(3/8)
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