The previous attempt at $40,000 on Monday triggered overbought readings, which preceded a near 10% pullback. However, buyers have been active at lower support around $34,000-$36,000.
- The relative strength index (RSI) is overbought on the four-hour chart, which could trigger some profit taking.
- Bitcoin is roughly 20% above the 100-period moving average on the four-hour chart. The most recent above average extension was seen in mid-June as buyers failed to break above $40,000 resistance.
- Downside momentum has slowed considerably over the past month as bitcoin continued to hold $30,000 support. The current rally could encourage further buying once oversold signals appear on the weekly chart.
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