Bitcoin Price Shows Recovery Signs – Technical Analysis Points to Potential Rally

Bitcoin price is showing clear signs of recovery as it attempts to climb above the $112,500 level. The cryptocurrency is currently in a consolidation phase while traders watch for a potential breakthrough above the critical $114,250 resistance zone.

Technical Breakout Signals Emerge

Bitcoin initiated a fresh recovery wave from the $110,200 support zone. BTC successfully climbed above multiple resistance levels at $111,500 and $112,500, demonstrating renewed buying interest in the market.

The bulls managed to push the price above the $113,000 and briefly above $114,000. Notably, Bitcoin broke above a bearish trend line with resistance at $112,300 on the hourly chart of the BTC/USD pair. This technical breakout allowed the price to reach a local high of $114,270 before entering the current consolidation phase.

Recent price action shows a minor retracement below $114,000, with Bitcoin testing the 23.6% Fibonacci retracement level of the recent upward move from the $110,815 swing low to the $114,270 high. This shallow retracement suggests underlying strength in the current recovery attempt.

Market Momentum Analysis

Bitcoin is now trading above two key technical indicators: the $112,500 price level and the 100 hourly Simple Moving Average. These factors typically provide strong support for continued upward momentum in technical analysis frameworks.

The immediate resistance level stands at $114,250, which coincides with the recent local high. Breaking through this first key resistance near $114,500 could trigger further upside movement. The next significant resistance zone appears at $115,000, with a successful close above this level potentially accelerating the rally.

If the bullish momentum continues, Bitcoin could target resistance levels at $115,500 followed by $116,200. Technical projections suggest that a sustained breakout could eventually push prices toward the $118,000 region.

Trading volume analysis shows increasing participation during upward price movements, while volume tends to decrease during consolidation phases. This volume pattern supports the potential for continued upward momentum if key resistance levels are cleared.

Potential Downside Scenario

Should Bitcoin fail to overcome the $114,250 resistance zone, a fresh downward correction remains possible. The immediate support level is positioned near $113,500, with the first major support at $112,500, which aligns with the 50% Fibonacci retracement level of the recent upward move.

Further support exists near the $112,000 zone, followed by $111,500. A break below these levels could accelerate the decline toward the critical $110,500 support area. Market technicians note that breaking below $110,500 might trigger a sharper decline as it would violate the current recovery structure.

Technical Indicators Status

The hourly MACD (Moving Average Convergence Divergence) indicator is gaining momentum in the bullish zone, suggesting increasing positive momentum in the short term.

Meanwhile, the hourly RSI (Relative Strength Index) for BTC/USD is currently positioned above the 50 level, indicating moderate bullish sentiment in the market.

Key support and resistance levels to monitor:

Major Support Levels:

• $112,500
• $112,000
• $110,500

Major Resistance Levels:

• $114,250
• $115,000
• $118,000

Disclaimer: For information purposes only. Past performance is not indicative of future results.