Bitcoin (BTC) has traded in a tight range over the past two days after rallying nearly 18% from the April 25 low around $47,000. The cryptocurrency was trading around immediate support at $54,700 at the time of writing and has nearly retraced 50% of the prior two-week downtrend. Lower support is around $52,000.
- BTC stalled just below $56,000 resistance after the relative strength index (RSI) reached overbought levels on intraday charts.
- Lower highs on the hourly RSI indicates slowing upside momentum after the 18% price rally. Typically slowing momentum suggests profit taking as buyers look to establish positions at lower support levels.
- BTC is trading just above the 50-period volume weighted moving average on the hourly chart, which could provide immediate short-term support.
- BTC will need to return above $56,000 to sustain the recovery from last week’s sell-off.