Bitcoin Correcting Gains, What Could Trigger Fresh Rally

July 5, 2021

Bitcoin price is correcting gains from well above $35,000 against the US Dollar. BTC is likely to find a strong support near the $34,000 zone in the near term.

Bitcoin started a downside correction from the $36,000 zone.
The price is now approaching the $34,000 support and the 100 hourly simple moving average.
There was a break below a major bullish trend line with support near $35,000 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair is likely to find a strong buying interest near $34,000 and the 100 hourly SMA.

Bitcoin Price is Approaching Support
Bitcoin climbed higher above the $34,000 and $35,000 resistance levels. BTC even broke the $35,500 level and the 100 hourly simple moving average.
However, the price failed to clear the $36,000 zone. A high was formed near $35,918 before the price started a fresh decline. The price traded below the $35,500 and $35,000 levels. There was a break below the 23.6% Fib retracement level of the upward wave from the $32,735 swing low to $35,920 high.
Moreover, there was a break below a major bullish trend line with support near $35,000 on the hourly chart of the BTC/USD pair. The pair is now approaching the $34,000 support and the 100 hourly simple moving average.
The 50% Fib retracement level of the upward wave from the $32,735 swing low to $35,920 high is also near the $34,350 zone. The next key support is near the $34,000 zone. If there is a downside break below the $34,350 and $34,000 support levels, the price could continue to move down.

Source: BTCUSD on TradingView.com
In the stated case, the price might decline towards the $32,500 zone. Any more losses may possibly push the price towards the $31,200 support zone.
Fresh Increase in BTC?
If bitcoin remains stable above the $34,000 support zone, it could start a fresh increase in the near term. An immediate resistance on the upside is near the $35,000 level and the trend line.
The next key resistance is near $35,250, above which the price could test the $36,000 barrier. Any more gains could lift the price towards the $37,000 resistance.
Technical indicators:
Hourly MACD – The MACD is slowly gaining pace in the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.
Major Support Levels – $34,350, followed by $34,000.
Major Resistance Levels – $35,000, $35,500 and $36,000.