Sep 12 Bitcoin is doing Bitcoin business as usual. Since September 9, the price has broken out nicely, posting nearly 16% gains and entering a long-term downtrend line that appears to be resistant at $23,000.
Maybe BTC and the broader market is turning bullish ahead of it Ethereum Merger which is scheduled for September 14, or perhaps the elusive bottom is finally in. Weekly chart data from TradingView shows that on June 27 and August 15, the Bitcoin Relative Strength Index fell to lows not seen since 2019.
Currently, the metric has rebounded from an almost oversold 31 to a current reading of 38.5. Some traders may also notice a bullish divergence in the metric, where the RSI is following an upward trendline, while the weekly Bitcoin candlesticks are trending down. Bitcoin’s Moving Average Convergence Divergence (MACD) also swung as buying volume surged and BTC price attempted to break out of its current 90-day range.
As stated in previous analysis, since January 21, the price of Bitcoin has simply been trading in a range, which has turned out to be consecutive bearish flags that continue to new yearly lows. The price is consistently hitting resistance at the upper descending trend line and the price action witnessed today and over the past 90 days is not a deviation from the trend.
Traders should watch BTC price to ensure multiple daily closes above the trendline resistance and setting a daily higher high above $25,400 or even breaking the 200-MA at $30,000 would be a great look at a trend reversal or at least a move towards a new consolidation scope. Until that happens, the standard practice among traders is not to continue long at long-term resistance and wait to see if the bullish momentum is sustained or the prevailing trend remains intact.
Of course, there are several other on-chain and derivative metrics that could add valuable context to Bitcoin’s current price action, but the purpose of this brief analysis is simply to provide a quick and fast interpretation of BTC’s current market action and to consider what traders may be thinking in the short term.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Cointelegraph.com. Every investment and trading step involves risk, you should do your own research when making a decision.