Bitcoin’s parabolic ascent seems unstoppable. Lately, each correction has been seen as a chance to purchase closely on dips. This week, the primary cryptocurrency is up by as a lot as 15 % and it seems like bulls are gunning for the 2019 high of $13,868.44.
The environment is so bullish that CryptoTwitter is beginning to really feel euphoric. One cryptocurrency dealer and investor that goes by the identify Josh Rager shared a picture of an impressive bull with a caption “$13okay $BTC” as an example the energy of the uptrend.
— Josh Rager 📈 (@Josh_Rager) July 10, 2019
Whereas bulls are celebrating, an examination of bitcoin in each the short-term and long-term timeframe reveals that bulls are operating out of steam. Indicators look overheated, which makes a retracement right down to $9,000 a really probably state of affairs.
Bitcoin Flashes Traditional Bullish Exhaustion Indicators on the Weekly Chart
The primary cryptocurrency soared from $4,000 ranges in March 2019 to shut to $14,000 final month. That’s an astronomical ascent of round 245 % in three months. The steep rise got here with little or no correction. And not using a vital retracement, the long-term well being of the uptrend is in danger.
This danger might come into play within the subsequent few days because the market exhibits indicators of bullish exhaustion. First, bitcoin’s worth continues to rise, but quantity has considerably declined over the previous two weeks. This divergence tells us that demand is starting to dwindle and sellers are simply biding their time earlier than they dump their positions.
Along with that, the weekly RSI signifies that the cryptocurrency is massively overbought. It’s approaching RSI resistance of 90. This can be a stage that has by no means been breached. In different phrases, bitcoin has all the time retraced after tapping this RSI resistance.
Quick-term Timeframe Appears Even Worse
Bitcoin’s day by day chart paints an uglier picture. Along with the slumping quantity, the day by day RSI has printed a triple high sample. This bearish construction is coupled with a big bearish divergence. The value might proceed to rise however momentum is visibly waning.
Additionally, the day by day candles over the past two days have wicks on high of their our bodies. This is a sign that sellers are rising.
As demand and momentum present indicators of weak spot, it received’t take lengthy earlier than extra sellers take discover. After they do, bitcoin will probably appropriate to $9,000.
It is probably that market individuals are holding on their positions as they anticipate extra upside potential. This explains why the worth retains rising despite the fact that quantity has been anemic.
Nevertheless, the failure to breach and even contact the 2019 excessive of $13,868.44 might probably ignite a waterfall occasion. Sellers would notice that the highest is in and they’d dump positions in a rush. If this occurs, bitcoin could possibly be buying and selling round $9,000 ranges.
Click on here for a real-time bitcoin worth chart.
Disclaimer: This text is meant for informational functions solely and shouldn’t be taken as funding recommendation.