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Bitcoin price has punched above its $38,000 resistance level, trading briefly above $38,700 on Binance before falling back down to around $38,500 in the early hours of Friday morning. After a period of consolidation around the $35,000-$37,000 levels, the world’s largest digital currency is now eyeing an attempt to break the stiff resistance levels around $40k.
If Bitcoin’s price successfully breaches this zone, it may open up fresh upside momentum towards the all-time highs of around $42,000. The bulls appear to have gained the upper hand on the daily chart, after the MACD line (blue) crossed above the signal line (red). The bullish crossover has been supported by a strong uptick in the daily RSI indicator.
On the downside, key chart support can be found at around $36,500 and then at the 50-day simple moving average (SMA) which is sitting at around $34,250. The bulls have so far been successful in defending this technical area which is providing the needed bounce for Bitcoin’s bounce back above the $37k zone.
The daily chart also shows that there is not much action around the crucial $40k level, which could make it difficult for Bitcoin to break past in the coming days. However, with the commitment of institutional investors and companies to enter the space, Bitcoin may have the support needed to break above this level.
Whilst it is difficult to draw a definitive conclusion from Bitcoin’s current market movement, it looks like the outlook is still mostly bullish. In order for Bitcoin to break past the $40k level, strong market demand needs to be created with further institution visits. Nevertheless, right now, Bitcoin appears to be in a good position to test its past highs.