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Bitcoin Stalls at $56K Resistance; Support Within Reach
Bitcoin stalled just below $56K resistance after a near 18% price recovery from last week's sell-off. Short-term support is within reach.
Bitcoin (BTC) has traded in a tight range over the past two days after rallying nearly 18% from the April 25 low around $47,000. The cryptocurrency was trading around immediate support at $54,700 at the time of writing, and has nearly retraced 50% of the prior two-week downtrend. Lower support is around $52,000.
STORY CONTINUES BELOW
- BTC stalled just below $56,000 resistance after the relative strength index (RSI) reached overbought levels on intraday charts.
- Lower highs on the hourly RSI indicates slowing upside momentum after the 18% price rally. Typically slowing momentum suggests profit taking as buyers look to establish positions at lower support levels.
- BTC is trading just above the 50-period volume weighted moving average on the hourly chart, which could provide immediate short-term support.
- BTC will need to return above $56,000 to sustain the recovery from last week’s sell-off.
Damanick Dantes
Damanick was a crypto market analyst at CoinDesk where he wrote the daily Market Wrap and provided technical analysis. He is a Chartered Market Technician designation holder and member of the CMT Association. Damanick is also a portfolio strategist and does not invest in digital assets.
