Bitcoin approaches major resistance

Bitcoin approaches major resistance

Bitcoin / Dollar BITFINEX:BTCUSD


Bitcoin             staged an impressive rally last week and continues to perform quite well on Monday. The price has regained the 100-DMA             at $7,600 and jumped to May 23 highs just below the $7,800 level which represents the immediate resistance for bulls now.

The sentiment in the digital currency markets continues to improve due to a lack of negative headlines and developments in the industry. The ongoing rally is partly fuelled by the so-called fear of missing out or “FOMO”, where traders tend to join the ascent in order not to “miss this train”. However, without fresh bullish catalysts, the ascent will hardly continue much from the current levels.

As for the technical factors, there are some signs pointing to a correction risk already. As such, the bullish MACD in the daily charts shows signs of fading impetus, RSI is indicating overbought conditions, while the $7,800 area serves as a rather stiff resistance on the way to the $8,000 handle. Therefore, the coin could see a corrective retreat before another push higher.