Bitcoin (BTC) Price Weekly Forecast: Risk of Extended Drop To $8,880

There was a major drop in bitcoin price after it broke the $12,000 support against the US Dollar.

The price is currently holding the key $10,800 support area, but it remains at a risk of more losses.

There was a break below a key bullish trend line with support at $12,100 on the 4-hours chart of the BTC/USD pair (data feed from Kraken).

The pair could extend losses towards the $8,880 level if there is a successful break below $10,800.

Bitcoin price is holding the key $10,800 support area against the US Dollar. Having said that, BTC remains at a risk of more losses if there is no break above $11,600 and $12,000.

Bitcoin Price Weekly Analysis (BTC)

This past week, bitcoin price declined heavily below the $12,200 and $12,000 support levels against the US Dollar. The BTC/USD pair even broke the $11,500 support and settled below the 100 simple moving average (4-hours). However, the bulls were able to hold the key $10,800 and $11,000 support levels (as forecasted in the recent analysis).
The recent drop from the $13,182 swing high was initiated once there was a break below a key bullish trend line with support at $12,100 on the 4-hours chart of the BTC/USD pair. The pair even broke the 50% Fib retracement level of the upward move from the $9,708 low to $13,182 swing high. It opened the doors for more losses and the price even spiked below the $11,000 level.

However, the $10,800 support level holds the key and is protecting more losses. Moreover, there was no close below the 61.8% Fib retracement level of the upward move from the $9,708 low to $13,182 swing high. On the upside, an initial resistance is near the $11,500 level and the 100 simple moving average (4-hours). Above the 100 SMA, the price could face a strong resistance near the $12,000 level.

If there is a successful close above $12,000, the price could start a fresh increase towards the $12,400 and $12,500 levels. Conversely, if the bulls fail near $11,500 or $12,000, there could be another dip. More importantly, there is a risk of a downside break below the key $10,800 support area. In the mentioned case, the price could test the $8,880 support area. It represents the 1.236 Fib extension level of the upward move from the $9,708 low to $13,182 swing high.

Looking at the chart, bitcoin price is clearly struggling to rebound above $12,000 and it could extend losses towards the $8,880 level if there is a successful break below $10,800.

Technical indicators

4 hours MACD – The MACD for BTC/USD is slowly moving in the bearish zone.

4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is currently well below the 50 level.

Major Support Level – $10.800

Major Resistance Level – $12,000