Bitcoin price started a consolidation phase below $120,000. BTC could start a fresh rally unless there is a close below the $116,500 support.
Bitcoin Price Holds Uptrend Support
In the last analysis, we saw a decent increase in Bitcoin price above the $115,000 resistance level. The bulls were able to push the price above the $120,000 resistance. The price traded to a new all-time high above the $123,000 level.
Recently, the price started a short-term downside correction below the $120,000 support zone. There was a drop below the $118,500 support zone and the price even spiked below the 23.6% Fib retracement level of the upward move from the $98,579 swing low to the $123,120 high.
Bitcoin tested the $116,500 support zone and started a consolidation phase. It is now consolidating above the $117,000 level and the 50-day simple moving average (blue). There is also a key bullish trend line forming with support at $118,000 on the daily chart.
The current price action and the current candle suggest that the bulls might attempt a fresh increase. On the upside, immediate resistance is near the $120,500 level. The first major resistance is near the $121,800 level. A close above the $121,800 resistance might spark more upsides.
In the stated case, the price could attempt a move toward the $123,000 level. A close above the $123,000 level could send the BTC price toward the $125,000 level and a new ATH. Any more gains might call for a test of $128,000.
Downside Break In BTC?
If Bitcoin bulls fail to push the price above $120,500, there could be a bearish reaction. Immediate support is near the $118,000 level and the trend line. The first major support is near the $116,500 level and the trend line zone.
A downside break and close below the $116,500 support might start a major downside correction. In the stated case, Bitcoin could test the $113,200 support. The next key support could be $110,500 and the 50-day simple moving average (blue). It is close to the 50% Fib retracement level of the upward move from the $98,579 swing low to the $123,120 high.
If the bulls fail to protect the $110,500 zone, the price could start a major decline. In the stated case, the price could test the $107,950 support. Any more losses might call for the test of the $104,400 support.
Overall, Bitcoin is consolidating above the key support at $116,500 and the 50-day simple moving average (blue). To start a fresh increase, the price must stay above $116,500 and settle above the $120,500 level in the coming sessions.
