After diving as low as $ 8,600 on June 2, Bitcoin rebounded to $ 9,700, recovering from the support level after the support level. It was a move that convinced analysts that more hikes are in the works.
A trader said that as long as Bitcoin held $ 9,600, which he called a noticeable short-term level, he sees no clear reason "why $ 11,000 wouldn't be next."
Galaxy Digital CEO Mike Novogratz shared the optimism. He told BitMEX CEO Arthur Hayes that if the BTC didn't climb higher than the $ 9,700 range, he would buy him a steak dinner the next time they were in Tokyo.
Although a key indicator suggests that the uptrend is over - or at least it is almost over.
BITCOIN BULL TREND IS FINALLY TOP
The Bitcoin showed extremely impressive strength from the lows of $ 3700 in March.
Even after a severe rejection of $ 10,500 that wound up tens of millions, the cryptocurrency is still up more than 160% from March lows. This means that in recent months, the BTC has outperformed virtually every other multi-billion dollar asset on a public market.
Impressive, really, but the Bollinger Bands show that the rally could end soon.
A trader shared the graph below on June 6 with the following comment:
“What is the difference between the summit at 19k, 13k, 10.5k and now?”
What he is referring to is the fact that Bitcoin is approaching from the top of the Bollinger Bands (shaded in turquoise in the table below).
The last time this happened was in February this year, when prices have reached $ 10,500 before plunging into the March lows. Prior to that, Bitcoin had reached $ 14,000 in June. And the previous period was at the top of the 2017 crypto bubble, when the BTC saw a brutal crash after hitting $ 20,000.
Macro price chart of Bitcoin and Bollinger Bands shared by the cryptocurrency trader “Crypto_y_tho” (@BTC_y_tho on Twitter).
If Bitcoin follows a historic precedent, the rally will continue but will end as soon as BTC begins to interact with the top of the Bollinger bands , currently at $ 11,000. The analyst explained:
“Based on the last 9 prices cleared and closed several weeklies above the middle of the bbs, the price did not exceed until it reached the upper BB. So we haven't finished this move. "
Technical analyst John Bollinger , creator of the Bollinger Bands himself is bearish on Bitcoin at the moment. He wrote earlier this week:
“The is a headache to Bollinger's top band for $ btcusd, time to be careful or short.”
OTHER TECHNICAL SIGNS CORROBOR THIS
Other technical signals corroborate the feeling that Bitcoin will soon start to reverse on the downside.
An analyst identified three of these signs last week:
- The Tom Demark Sequential has printed a “9” candle, which is often seen at trend reversal points.
- There are hidden bearish discrepancies between a momentum indicator and the price of Bitcoin .
- The Stochastic Relative Strength Index ( RSI ) saw a bearish cross for the first time since February.
Crypto Hamster graphic (@CryptoHamsterIO on Twitter).
