Bitcoin Declines From $40K Resistance; Support at $34K
Bitcoin (BTC) had a sharp 10% pullback after approaching the $40,000 resistance level on Monday. The cryptocurrency is holding initial support above $36,000 at press time and is up about 25% over the past week.
Lower support is seen around $34,000 which could stabilize the current pullback.
The relative strength index (RSI) on the four-hour chart reached extreme overbought levels over the weekend as bitcoin rallied. Overbought conditions typically precede price declines as buyers take profits.
The RSI on the daily chart is approaching overbought levels, which could limit bitcoin’s upside beyond $40,000 resistance.
Although the intermediate-term downtrend is improving, bitcoin remains in a consolidation phase between $30,000 and $40,000, which suggests buyers and sellers are in a stalemate despite occasional rallies and selloffs.
