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.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.