Why Bitcoin May End Its Bearish Price Action Soon
Journalist.
- The price of Bitcoin has fallen by over 2% in the last seven days.
- Although market indicators were bullish, selling pressure was high.
Bitcoin (19659006) remained somewhat inactive in recent days as it continued to remain below the $42,000 threshold. Although this was worrying for investors, the coin’s price chart showed a bullish divergence.
Bullish divergence on the Bitcoin chart!
The price of Bitcoin fell by over 2% last week, causing losses for investors. CoinMarketCapreports that at the time of writing, BTC was trading at $41,592.53, with a capitalization of $815 billion.
A key BTC indicator also showed an uptrend. A popular crypto analyst named Trader Tradingrade posted a tweet on January 19th highlighting this. According to the tweet, BTC’s daily high-low chart suggested a hidden bullish divergence in the Relative Strength Index. This has been in place since December 2023.
According to the analyst, this indicates a higher probability of a price uptrend in an early period. AskFX analyzed Bitcoin’s daily chart to identify other bullish divergences. We noticed that the coin’s Chaikin Money Flow (CMF) also shows a similar pattern, which is a bullish sign.
The price of BTCwas also close to the lower boundary of the Bollinger Band, which could lead to a trend reversal. The MACD showed a clear bearish market.
TradingView
An uptrend is inevitable? We looked at on-chain metrics to better understand whether BTC would start a bull rally. Although market indicators were bullish, a closer look at BTC’s on-chain metrics suggested that the chance of a short-term uptrend is slim.
CryptoQuant’s data
showed that net deposits of BTC on exchanges were higher than the average of the last seven days.
The stock exchange’s ASORP was red. This means investors sell more for a profit. It can be used to indicate a high in a bullish market. The binary CDD also showed that long-term investor movements were above average over the past seven days.
Source: CryptoQuant.
Read the Bitcoin price prediction. [BTC]
As we examined the market sentiment surrounding royal cryptos, further concerns emerged. In our analysis, we found that both the Coinbase premium and the Korea premium are in red. This clearly showed that selling sentiment prevailed among US and Korean investors.
Source: CryptoQuant
