The Bitcoin (BTC) price has continued to advance after a sharp rise above the $29,400 support. Yesterday, July 26, the BTC price consolidated above the $34,000 support before finally breaking out above the $35,000 high.
Prior to yesterday's breakout, resistance between $34,400 and $35,000 remained unbroken since June. Breaking above these resistance zones catapulted Bitcoin to the $38,000 high.
Yesterday's rally reached the high of $39,777 but was resisted. The next hurdle for the bulls is to break the psychological price level of $40,000. After the recent rally, BTC price is retesting the $40,000 resistance level to break it. BTC/USD is capable of reaching the high of $42,000 if buyers overcome the resistance level of $40,000. However, price indicators have indicated an overbought condition in the market. Subsequent upward movements are doubtful.
Bitcoin price has reached the level 67 of the Relative Strength Index of the period 14. It indicates that Bitcoin does not have enough room for an upward movement. The cryptocurrency is above the 80% area of the daily stochastic. It indicates that the cryptocurrency is in the overbought area of the market for the last 48 hours. The implication is that bullish momentum is weakening or reaching bullish exhaustion.
Major Resistance Levels - $65,000 and $70,000
Major Support Levels - $40,000 and $35,000
With the recent rally, BTC/USD has regained bullish momentum. The cryptocurrency is now trading in the bullish trend zone. Meanwhile, the uptrend from June 29; a retraced candlestick has tested the 50% Fibonacci retracement level. The retracement suggests that bitcoin will rise to the 2.0 Fibonacci Extension level or the $42,553.30 level. From the price action, buyers are struggling to push Bitcoin above the $40,000.
Disclaimer. This analysis and forecast are the personal opinions of the author are not a recommendation to buy or sell cryptocurrency and should not be viewed as an endorsement by CoinIdol. Readers should do their own research before investing funds.