Bitcoin price has pared most of its losses from its sell-off earlier this month. BTCUSD is up by over 23% from March 13. Its technical setup on the 4-hour time frame also suggests that it could be priming for a rally.
By connecting the lows of March 13, March 16, and March 23, it can be seen that bitcoin price recently bounced off support at the rising trend line. As of this writing, BTCUSD is testing resistance around $6,840.00. This price has served as the ceiling for the past few trading days. A strong bullish close above this level could mean that bitcoin price may soon rally past $7,000.00. If this turns out to be the case, the next resistance level could be around $7,920.00 where the cryptocurrency stalled on March 11.
On the other hand, the hourly time frame reveals that bitcoin price has formed a rectangle. This chart pattern is characterized by steady highs and lows. This means that reversal candlesticks at the top of the rectangle could mean that there may still be enough sellers in the market. Should this be the case, BTCUSD may fall to support at the bottom of the channel at $6,520.00. This would also effectively break support at the rising trend line and could mean that a bigger sell-off is ahead. The next near-term support would be at $6,384.00 where BTCUSD topped on March 22.