Bitcoin Oversold Near $46K Support; Resistance at $55K

The cryptocurrency could see a brief price bounce, although sellers remain in control.

Dec 16, 2021 at 7:11 p.m. UTC
Updated Dec 16, 2021 at 7:12 p.m. UTC

Bitcoin (BTC) continues to hold support above $46,000, which is near its 200-day moving average. The cryptocurrency could see a brief price bounce toward $55,000 if buyers react to oversold signals on the charts.

BTC was changing hands around $47,900 at press time and has traded in a tight trading range over the past week.

Price momentum is starting to turn positive on the daily chart for the first time since October, which preceded a price recovery. This time, however, the uptrend is slowing on the weekly chart, which means upside could be limited beyond $55,000 to $60,000.

The relative strength index (RSI) on the daily chart is the most oversold since late-September, although buying has been weak relative to prior RSI signals.

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Damanick is a crypto market analyst at CoinDesk where he writes the daily Market Wrap and provides technical analysis. He is a Chartered Market Technician designation holder and member of the CMT Association. Damanick is also a portfolio manager at Cannon Advisors, which does not invest in digital assets. Damanick does not own cryptocurrencies.