Bitcoin Holding Support Above $37K; Resistance at $40K-$45K
BTC's January sell-off could attract short-term buyers.
Jan 31, 2022 at 6:50 p.m. UTC:format(webp)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/SZGOS4EH2VD4BM7R7YKJDLUC5U.png)
Bitcoin four-hour price chart shows support/resistance levels. (Damanick Dantes/CoinDesk)
Bitcoin (BTC) is rising toward the top of a week-long trading range as oversold signals remain intact. Oversold refers to investors believing the asset is trading below its true value. BTC was trading around $38,400 at press time and is up 4% over the past week.
Initial resistance is seen at $40,000, which is an old support level that was rejected on Jan. 20. Buyers will need to make a decisive move above $40,000-$45,000 in order to shift the downtrend since November.
For now, BTC’s 20% price decline in January could attract short-term buyers. Traders could place additional bids into the Asia trading day if support at $37,000 holds.
Over the long term, upside appears limited given negative momentum signals.
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Damanick was a crypto market analyst at CoinDesk where he wrote the daily Market Wrap and provided technical analysis. He is a Chartered Market Technician designation holder and member of the CMT Association. Damanick is also a portfolio strategist and does not invest in digital assets.
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