Bitcoin analyst eyes 'V-shape' BTC price bounce as RSI hits 5-year low

1 year ago

Bitcoin (BTC) stayed stubbornly anti-trend connected Aug. 22 arsenic $26,000 became a magnet for intraday BTC terms action.

BTC terms "death chop" returns

Data from Cointelegraph Markets Pro and TradingView tracked a 3rd time of sideways show connected BTC/USD.

Despite being heavy oversold according to comparative spot scale (RSI) readings, Bitcoin refused to connection immoderate signifier of betterment bounce from levels past seen 2 months prior.

Market participants were restless, with fashionable trader Jelle referring to intraday movements arsenic the “death chop.”

“At this signifier it feels similar a crippled of chickenhearted to spot who is going to marque a determination to interruption the chop,” monitoring assets Material Indicators continued.

Analyzing liquidity connected the Binance BTC/USD bid book, Material Indicators noted a wide deficiency of liquidity, expanding the imaginable for a crisp determination successful either direction.

“The marketplace is waiting to spot if much bid oregon much inquire liquidity is going to beryllium attracted to the range,” it explained to X subscribers.

“So far, we are seeing tiny amounts of bid liquidity ladder up from $20k person to the progressive trading zone, but nary liquidity of immoderate size (new oregon moved) has been stacked into the scope defending terms from a Lower Low.”

The implications were nevertheless potentially precise superior for bulls, with a little debased (LL) apt to hazard adjacent $20,000 enactment going forward.

“Needless to say, printing a LL successful this TF has macro implications. Printing 2 LLs would propulsion BTC down to sub $20k levels,” Material Indicators concluded.

RSI strengthens "V-shape recovery" thesis

Zooming out, anticipation remained that Bitcoin could rescue its wide uptrend.

In a dedicated YouTube update connected the day, Michaël van de Poppe, laminitis and CEO of trading steadfast Eight, noted the heavy oversold signals being generated by RSI.

On 12-hour timeframes, RSI measured little than 19 astatine the clip of penning — adjacent its lowest levels since the 2018 carnivore marketplace bottom. Daily levels were similar, reaching their lowest since the March 2020 COVID-19 cross-market crash.

“Every clip we spot specified a move, you get a benignant of V-shape betterment backmost up, and it finds an equilibrium connected a higher floor,” Van de Poppe said astir erstwhile BTC terms flash crashes.

He added that it was “very likely” that Bitcoin could signifier a comeback to absorption connected $26,500 oregon much next.

“Current Bitcoin terms enactment reminds maine of September 2020 — conscionable earlier the commencement of the erstwhile bull market,” Jelle meantime suggested alongside a comparative chart.

“Absorption and dilatory grind higher present for a portion — and I could spot this play retired similarly.”

This nonfiction does not incorporate concern proposal oregon recommendations. Every concern and trading determination involves risk, and readers should behaviour their ain probe erstwhile making a decision.

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