Bitcoin (BTC) Price Indicators Point to a Bullish Divergence

Bitcoin (BTC) looks strong as indicators point to a bullish breakout.

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Bitcoin (BTC) looks strong as indicators point to a bullish breakout.

Bitcoin (BTC) has successfully staved off any more rot occasioned by the meltdown in market prices over the month of August.

Bitcoin (BTC) Price Indicators Point to a Bullish DivergenceThe top coin has recovered from a market decline that saw it trade just above its lowest price of $5,755 for the year.

According to data from XBT.net, BTC prices dropped to a low of $5,971 on August 14, a fraction away from its year’s bottom reached in June.

The rest of the market replicates the same scenario, with all major altcoins being massacred. Most of the top ten crypto assets saw their prices dipping to new lows. It threatened a massive bloodbath.

Ethereum and Ripple, which are the second and third largest coins by market cap, had declined by over 9 percent that day. Similar stumbles were recorded by EOS, LTC, and ADA.

However, a U-turn by Bitcoin yesterday saw the rest of the market respond positively, plugging altcoin bleeding. Nevertheless, most of the altcoins have recovered their losses with most coins seeing very strong gains for the first time in this week.

The top crypto gained by over 6 percent on the day to see its price rally above $6,300, according to CoinMarketCap. At the moment, BTC/USD is trading at $6,512, less than 1 percent up in the last 24 hours.

BTC price: 24-hour outlook

A look at BTC’s daily chart paints a positive outlook. The stochastic and Relative Strength Index (RSI) indicators have moved higher, forming a bullish divergence.

Prices might have dipped, but an upward momentum by these oscillators indicates that it’s ready to move away from the bearish trend.

Oscillators created a similar divergence that preceded the bullish surge for Bitcoin in July.

Also notable is the fact that monthly RSI registered its lowest figure since Oct.1, 2015. This value can be the trigger that leads to a surge in buying pressure, which could offset the bearish outlook that has dominated the year.

The MACD is also pointing towards a bullish outlook. It is a signal that bearish pressure is fading and that buyers could take control soon. If bulls return, BTC will likely break above the trend line.

Bitcoin’s quick pull back above its recent low is an indication that sell-off pressure is waning. The bears are showing signs of exhaustion.

Daily trading volume has also reduced significantly since mid-way in Q2. This factor has also played a big role in preventing the bears from driving prices into the ground.

Even as the indicators forecast a bullish outlook, Bitcoin remains delicately poised. It will likely invite sell-off pressure if prices retrace to its latest lows.

As such, BTC/USD needs to sustain momentum above support zones at $6,300 and $6,200 to avoid a decline.

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