Bitcoin Drops 2% After Failing to Surpass $108,800 Resistance

Bitcoin's price has recently experienced a decline after reaching a high of $108,800. The cryptocurrency is now trading below $107,000 and the 100 hourly Simple moving average, indicating a loss of bullish momentum. The price has formed a bearish trend line with resistance at $106,000 on the hourly chart of the BTC/USD pair, suggesting that further gains may be limited in the near term.

Bitcoin's price failed to surpass the $108,800 resistance and started a fresh decline. The price fell below the $107,000 level and even dipped below the $106,000 level, forming a low at $105,116. The price is now trading in a range below the 23.6% Fib retracement level of the downward move from the $108,792 swing high to the $105,116 low.

On the upside, immediate resistance is near the $106,000 level. There is also a bearish trend line forming with resistance at $106,000 on the hourly chart of the BTC/USD pair. The first key resistance is near the $106,500 level. A close above the $106,500 resistance might send the price further higher, potentially testing the $107,000 resistance level. Any more gains might send the price toward the $108,000 level.

If Bitcoin fails to rise above the $106,500 resistance zone, it could start another decline. Immediate support is near the $105,500 level. The first major support is near the $105,000 level. The next support is now near the $104,200 zone. Any more losses might send the price toward the $103,500 support in the near term. The main support sits at $102,000, below which BTC might continue to move down.

Technical indicators suggest that the MACD is now losing pace in the bearish zone, while the RSI for BTC/USD is now below the 50 level. Major support levels are at $105,500 and $105,000, while major resistance levels are at $106,500 and $107,000.

Analysts have noted that the current price action suggests a period of consolidation may be on the horizon. Consolidation periods are characterized by sideways price movements, where the asset neither gains nor loses significant value over a short period. This phase allows the market to digest recent gains and build a foundation for future price movements.

The market's reaction to resistance levels is a key indicator of investor sentiment. When the price approaches a resistance level, it often triggers a wave of selling as traders look to secure profits. This selling pressure can cause the price to retreat, leading to a period of consolidation or even a correction. In the case of Bitcoin, the current resistance level has proven to be a formidable obstacle, and the market's response will be crucial in determining the cryptocurrency's next move.

As the market continues to navigate these challenges, investors and traders will be closely watching for any signs of a breakout or breakdown. A breakout above the resistance level could signal a continuation of the bullish trend, while a breakdown below support levels could indicate a reversal. The coming days and weeks will be critical in shaping Bitcoin's price trajectory and determining the market's overall sentiment.