Resistance At $40,000 Is A Major Obstacle On The Way Up For Bitcoin
Bitcoin is still trying to settle above the key resistance level at $40,000, but it looks that the world’s leading cryptocurrency lacks momentum for the move.
Yesterday, MicroStrategy announced that it planned to deploy additional capital to its digital asset strategy, which means that the company will buy more Bitcoin. However, this news had no impact on Bitcoin, and it looks that many traders have decided to take some profits off the table near the key resistance level at $40,000.
As a result, Bitcoin Dominance, which measures the market capitalization of Bitcoin as a percentage of total market capitalization, pulled back towards the 48% level as some capital moved from Bitcoin into altcoins.
The technical picture for Bitcoin has not changed in recent trading sessions. Bitcoin needs to settle above the key resistance level at $40,000 to have a chance to continue its upside move. RSI remains close to the overbought territory, but there is plenty of room to gain additional upside momentum in case the right catalysts emerge.
A move above the $40,000 level will push Bitcoin towards the resistance at June highs at $41,300. If Bitcoin manages to settle above this level, it will gain additional upside momentum, and speculative traders will likely rush to buy the world’s leading cryptocurrency.
On the support side, the nearest significant support level for Bitcoin is located at $38,000, but Bitcoin remains glued to the $40,000 level, and several attempts to gain some downside momentum yielded no results.
A successful test of the support at $38,000 will push Bitcoin towards the next support level near the 50 EMA at $36,000. The 20 EMA is located in the nearby so Bitcoin will likely receive significant support near this level.
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