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Bitcoin Rallies From Oversold Levels; Resistance Nearby
Upside momentum is improving after several months of consolidation.
Updated Mar 6, 2023, 3:21 p.m. Published Jul 26, 2021, 11:09 a.m.
Bitcoin (BTC) buyers were active over the weekend as the cryptocurrency broke above the 50-day moving average near $34,000. The intermediate-term downtrend is reversing, although resistance near $40,000 could trigger some profit taking.
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Upside momentum is improving after several months of consolidation and multiple oversold readings on the charts. Bitcoin was trading around $38,000 at press time and is up 10% over the past 24 hours. Early Monday, the price climbed to about $39,500.
- The relative strength index (RSI) on the daily chart is approaching overbought levels for the first time since April. This could precede a brief period of profit-taking near the 100-day moving average at $40,000.
- The weekly RSI is not yet oversold, although selling pressure from May is starting to slow.
- Price action is consistent with previous rallies from $30,000 support, albeit more persistent given the break above the 50-day moving average.
- Bitcoin remains in a consolidation phase until price moves above $40,000, which is the top of a two-month range. Initial support is seen around $34,000, which could stabilize a pull-back.
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When adjusted for asset market capitalization SOL's relative futures volume looks better, K33 Research noted.
What to know:
- Solana's SOL futures began trading on the Chicago Mercantile Exchange (CME) on Monday, with a notional daily volume of $12.3 million and $7.8 million in open interest, significantly lower than the debuts of bitcoin (BTC) and ether (ETH) futures.
- Despite the seemingly lackluster debut, when adjusted to market value, SOL's first-day figures are more in line with BTC's and ETH's, according to K33 Research.
- Despite the bearish market conditions, the launch of CME SOL futures offers new ways for institutions to manage their exposure to the token, said Joshua Lim of FalconX.
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