• Bitcoin price rallied to a new 9-month high towards $7,500 before correcting lower against the US Dollar.
• The price declined below the $7,000 support level, but it found strong bids near $6,750.
• There is a new connecting bullish trend line forming with support at $6,940 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair is currently in an uptrend and it is likely to climb back above $7,200 and $7,250.

Bitcoin price corrected sharply from $7,500 against the US Dollar. BTC tested key supports and it seems like it could bounce back above $7,200 in the coming sessions.

Bitcoin Price Analysis

In the past five days, there was a sharp rally in bitcoin price above the $7,000 resistance area against the US Dollar. The BTC/USD pair even broke the $7,200 and $7,350 resistance levels. The price tested the $7,500 resistance level and settled well above the 100 hourly simple moving average. A swing high was formed $7,590 and recently the price corrected lower sharply. It traded below the $7,200 support level and spiked below the $7,000 pivot level.

The price tested the key $6,700-6,800 support area, and a swing low was formed near the $6,733 level. BTC price recovered nicely and traded above the $7,000 level, and the 23.6% Fib retracement level of the recent decline from the $7,590 high to $6,733 low. However, the price seems to be facing a tough resistance near the $7,150 and $7,160 levels. The 50% Fib retracement level of the recent decline from the $7,590 high to $6,733 low is also acting as a resistance. A clear break above the $7,160 level may open the doors for a fresh increase above $7,200 and $7,250 in the near term.

On the downside, there is a decent support forming near the $7,000 level. Moreover, there is a new connecting bullish trend line forming with support at $6,940 on the hourly chart of the BTC/USD pair. Therefore, the pair remains well supported near the $6,950 and $7,000 levels. Below $6,950, the price could retest the main $6,700-6,800 support area.

Looking at the chart, bitcoin price is clearly in a strong uptrend above the $6,700-6,800 support area. There could be a few swing moves, but the price is likely to climb above $7,200 once again. The next key resistance is near $7,310, above which the next stop for the bulls could be $7,500 and $7,600.

Technical indicators:

Hourly MACD – The MACD is about to move back in the bullish zone, with positive signs.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is moving higher and it is currently above the 50 level.

Major Support Levels – $7,000 followed by $6,950.

Major Resistance Levels – $7,160, $7,200 and $7,310.

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