Bitcoin Returns Above $30K, Resistance at $35K
BTC appears oversold, although trading conditions have been choppy over the past few days.
May 19, 2022 at 5:55 p.m. UTCBitcoin (BTC) held short-term support above $27,500 as buyers reacted to oversold conditions on the charts. The cryptocurrency could face resistance at $35,000, which is where the current downtrend accelerated earlier this month.
BTC was trading at $30,100 at press time and was up by 3% over the past 24 hours.
The relative strength index (RSI) on the daily chart is rising from oversold levels, which could keep short-term buyers active. Further, short-term momentum is improving, similar to what occurred in early March, which preceded a brief relief rally in price.
A countertrend reversal signal, per the DeMARK indicators, appeared on BTC's daily chart on May 12 alongside major equity indices. That suggests a relief rally in speculative assets could delay additional breakdowns in price.
Still, BTC will need to register a weekly close above $30,000 (and above 4,000 for the S&P 500) to confirm short-term bullish signals. For now, upside appears to be limited because of negative momentum signals on the weekly and monthly charts.
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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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