Working from the weekly timeframe of BTC/USD, the major cryptocurrency finished another week in a strong position. Adding more than +5.0%, last week’s advance marks a fourth consecutive week in the green, a move that has overthrown two notable resistance levels on the weekly timeframe.

While the advance has been impressive, some technical headwinds are seen on the weekly timeframe. This includes the channel resistance that recently made its way into the fight, extended from the high of $31,050, an ascending channel resistance that is accompanied by nearby resistance at $38,523 and the Relative Strength Index (RSI) testing overbought levels (highest since early 2021).

Drilling down to the daily timeframe, resistance at $36,361 was engulfed at the tail end of the week, which opened the door for price to test a resistance area between $38,523 and $37,624. Note that the upper boundary of this area is defined by the weekly timeframe’s resistance highlighted above. Also relevant on the daily chart, you will not need the Relative Strength Index (RSI), or any momentum oscillator for that matter, to identify that upside momentum has slowed considerably over the past couple of weeks despite notching up higher highs last week. However, it is still worth pointing out that the RSI remains high within the overbought territory and is showing signs of early negative divergence (ultimately, though, many traders will be looking for the indicator to at least exit overbought space [< 70.00] to help validate this divergence).

Therefore, the resistance between $38,523 and $37,624 will likely be monitored closely this week, with sellers possibly targeting support on the daily timeframe at $36,361 as an initial downside target, followed by the weekly support at $35,060.

Weekly Chart:

Daily Chart:

Charts: TradingView

DISCLAIMER:

The information contained in this material is intended for general advice only. It does not take into account your investment objectives, financial situation or particular needs. FP Markets has made every effort to ensure the accuracy of the information as at the date of publication. FP Markets does not give any warranty or representation as to the material. Examples included in this material are for illustrative purposes only. To the extent permitted by law, FP Markets and its employees shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided in or omitted from this material. Features of the FP Markets products including applicable fees and charges are outlined in the Product Disclosure Statements available from FP Markets website, www.fpmarkets.com and should be considered before deciding to deal in those products. Derivatives can be risky; losses can exceed your initial payment. FP Markets recommends that you seek independent advice. First Prudential Markets Pty Ltd trading as FP Markets ABN 16 112 600 281, Australian Financial Services License Number 286354.