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Bitcoin Price Analysis: Keep Eyes On $42K As RSI Shows Bullish Divergence

Bitcoin (BTC) price locks in gains after continuing sell-off on Tuesday. The price opened lower but quickly recovered back and tag the session’s high at $39,121.52. BTC must trade above the $39,500 resistance level to move higher.

  • Bitcoin price manages to trade higher on Tuesday.
  • Reliable support emerges near $37k as previously BTC jumps to swing highs.
  • RSI bullish divergence on the 4-hour chart supports a bullish outlook in the short term.

However, bitcoin prices still move in a familiar trading zone facing rejection near $45,000. But in the past BTC bounce back from the lower levels.

Bitcoin price looks for a short term bounce

Source: Trading View

Bitcoin price forms double bottom on the 4-hour chart near $37,163.80 horizontal support line. A double bottom is a bullish formation, which could Bitcoin price first toward the psychological $40,000 level.

Next, to confirm the continuation of the upside momentum BTC price needs to face many hurdles. A crucial level is placed at the 200-EMA (Exponential Moving Average) at $40,485.

A sustained buying pressure will lead the price above the 200-EMA leading to the horizontal resistance level at $42,000.

The upside momentum is supported by the increased trading volume as indicated by the Price Volume Trend (PVT).

On the flip side, if the price fails to sustain the session’s low then it could invalidate the bullish outlook for the pair.

The first downside side target could be found at lows of February 24 at $34,322.0.

Furthermore, a weekly close below $32,933.3 will next spot the stoppage at $29,301.

Technical indicators:

RSI: The daily Relative Strength Index (RSI) is giving bullish divergence since March 5 indicating a bullish outlook in the short term.

MACD: The Moving Average Convergence Divergence (MACD) is hovering near the oversold zone but with positive momentum.

As of publication time, BTC/USD is trading at $38,926, up 2.48% for the day.

 

 

Disclaimer

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

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