Bitcoin update -BTC bulls claws back some ground

• Bitcoin has reversed the losses of the previous week.

• Short-Term recovery needs a new stimulus.

A move above $3,800 ended in a sharp recovery that followed a strong sell-off on Monday. BTC/USD is changing hands at $3,823 at the time of writing, gaining over 3% in recent 24 hours. Also, the coin managed to claw back ground lost since the end of February. The trend remains positive, though a short-term bearish correction cannot be excluded.

Looking technically, DMA100 and DMA50 clustered in the area $3,680-$3,630 will continue to serve as formidable support for BTC. Now that the bears are in retreat, we may see an extended recovery towards $3,870-$3,900 area strengthened by 38.2% Fibo retracement levels (monthly and weekly).

A sustainable move higher will attract more speculative buyers and pave the way towards psychological $4,000. The ultimate resistance is created by $4,187-$4,200 area that encompasses February high.

On the downside, a return below $3,800 will upset the bulls. This development may lead to an extended sell-off with the aim at the above-said DMA100 at $3,680. If this strong barrier gives way, the next critical support at $3,630-3,600 will come into focus.

 

BTC/USD, 1D chart

 

 

Tanya Abrosimova

FXStreet

David