Bitcoin Rally Reaches Key Juncture, Why BTC Could Resume Increase

Bitcoin price started a strong increase above the $21,250 resistance zone. BTC/USD tested the $22,420 zone and is currently correcting gains.

Bitcoin Price Gains 10%

In the past three sessions, bitcoin price saw a decent increase above the $20,000 resistance zone against the US Dollar. The BTC/USD pair broke the $20,500 resistance zone and the 50 simple moving average (4-hours, blue) to move into a positive zone.

The upward move gained pace above the 50% Fib retracement level of the key decline from the $22,020 high to $18,638 low. During the increase, the price cleared a couple of bearish trend lines at $19,200 and $20,530.

Bitcoin hits resistance | Source: BTCUSD on TradingView.com

The bulls were able to push the above the $22,000 resistance zone and the $22,020 high. However, gains were limited above $22,200.

A high was formed near $22,425 and the price is now correcting gains. It moved below the $22,000 pivot level. There was a spike below the 23.6% Fib retracement level of the upward move from the $18,638 swing low to $22,425 high.

An initial support is near the $21,250 level. The next major support is near $20,800. There is also a connecting bullish trend line in place with support at $20,800 on the 4-hours chart.

The main support sits at $20,500 and the 50% Fib retracement level of the upward move from the $18,638 swing low to $22,425 high, below which the price could take a hit and test the 50 simple moving average (4-hours, blue). The next major support is near the $18,650 zone.

Conversely, the price might start another increase above the $22,000 resistance. The next key hurdle could be $22,400. A clear move above the $22,400 resistance could send the price towards the $23,150 resistance. Any more gains might set the pace for a move towards the $24,000 resistance zone.

Overall, bitcoin price is trading well above the $20,500 pivot level and the 50 simple moving average (4-hours, blue). There could be a short-term correction, but the price might resume its increase unless there is a close below $20,500 in the coming sessions.