Bitcoin holds support, faces resistance at 50k

Bitcoin (BTC) continued to slide over the weekend and is now down about 20% month-to-date. The cryptocurrency approached initial support around $42,000 which could stabilize the sell-off. Price recoveries remain limited, evidenced by several months of slowing momentum, suggesting that sellers remain in control.

Bitcoin is trading around $44,800 at the time of writing.

• The relative strength index (RSI) on the daily chart is now oversold similar to April 25 which preceded a near 20% price recovery.

• Bitcoin is below the 100-day moving average, which is now resistance at $54,000. However, BTC will likely face immediate resistance at the $50,000 level as the uptrend weakens.

• If initial support at $42,000 is broken, the next level of support is seen around $34,286, which is roughly a 50% retracement of the March 2020 low.

• Bitcoin remains in a consolidation phase after failing to sustain moves above $64,000. An intermediate-term bullish to bearish trend reversal is on watch, especially as sell signals appear on the weekly chart.

Daily bitcoin chart shows support and resistance levels with oversold RSI.

Source: TradingView