HOME CATEGORIES WRITE AND EARN 🔍
CATEGORIES WRITE AND EARN MORE

CRYPTO NEWS

Your favorite crypto news blog

Bitcoin Daily Close Pivotal To Save Dangerous RSI Breakdown

Bitcoin 2021/07/15 14:33 by Tony Spilotro

Bitcoin price is at an inflection point, with nearly every technical indicator mixed due to the weeks of sideways price action. By most standards, technicals slightly lean bearish, but crypto investors are hopeful the secular bull market remains intact.

Thus far, the bull market has held on by a string, or a thin line of support that’s been tested more times than we can count. The crucial support zone hasn’t yet been lost, but if the daily candle closes at current levels, a dangerous breakdown could follow.

Bitcoin Relative Strength Weakens, Begins Dangerous Breakdown

Bitcoin’s ever tightening trading range may soon finally break, according to the Relative Strength Index on daily timeframes. The strength measuring tool lets traders know when assets have reached oversold or overbought conditions and can provide early signals that a reversal could be coming.

The RSI can also form chart patterns and follow trend lines. Much like symmetrical triangles can form on price action, it also happens on technical indicators like the RSI.

Related Reading | Bitcoin Ready For Display Of Strength, But Which Direction Will It Break

Since the top started to form in Bitcoin earlier this year, the RSI has been making lower highs. At the same time, after the first low was put in following the 50% crash last quarter, a rising trend line has formed of higher lows.

However, Bitcoin is in the process of setting a new low, breaking down from the pattern, and potentially putting itself in a dangerous predicament.

bitcoin rsi breakdown

Bitcoin begins breakdown from RSI triangle | Source: BTCUSD on TradingView.com

Deeper Plunge Depends On RSI At BTC Daily Close

The breakdown of the RSI is happening just as a support line that’s on thin ice looks ready to give way. The support line is the neckline of a massive head and shoulders pattern, which has a target of around $15,000.

The RSI readings are only added to the oscillator’s gauge after the daily close, so there’s still time today for bulls to save the market from a potentially dangerous plunge.

Related Reading | Bitcoin Trend Strength Indicator Suggests Bull Run Isn’t Yet Over

There’s still hope yet, even if Bitcoin price does make a new low. If for some reason the price of Bitcoin sets a new low, but the RSI doesn’t, a bullish divergence could form.

Falling to such levels could make the price per BTC attractive again and would lead to more substantial support. Today’s daily close is especially critical for Bitcoin, and could finally take the leading cryptocurrency by market cap out of this godforsaken range.

Follow @TonySpilotroBTC on Twitter or via the TonyTradesBTC Telegram. Content is educational and should not be considered investment advice.

Featured image from iStockPhoto, Charts from TradingView.com

1 Like(s)



You should also read...

Bitcoin 05/07/20 22:00 by Nick Chong
Bitcoin Surged 150% After This Signal Last Appeared. It’s Almost Back Again
It’s been a slow past few weeks for the Bitcoin market. After hitting $10,500 at the start of June, the cryptocurrency has entered a short-term downtrend. While some say that this price action i...
Read More
Bitcoin 29/10/20 00:59 by Nick Chong
Analysts Flip Bullish as Binance’s Bitcoin Funding Rate Turns Negative
Bitcoin has undergone a strong drop since the highs seen yesterday. The price of the leading cryptocurrency fell from its highs of $13,850 to lows around $12,900. This drop was seemingly a result of t...
Read More
Bitcoin 17/11/20 03:00 by Cole Petersen
This Indicator Shows Bitcoin May Surge Before Seeing a 20%+ Pullback
Bitcoin is seeing some intense strength today, with bulls pushing the cryptocurrency towards $17,000 following a brief bout of weakness earlier this week. The ongoing uptrend has marked a significant ...
Read More
Bitcoin 01/07/21 23:31 by Tony Spilotro
Bull Signal From Bitcoin Bottom Is Best Hope Yet For Continuation
Bitcoin price continues to struggle to regain any type of bullish momentum, and keeps grinding at repeatedly tested support. In the past, when this happens, the support ultimately breaks down and a ca...
Read More
Bitcoin 07/07/21 19:45 by Tony Spilotro
Bitcoin Ready For Display Of Strength, But Which Direction Will It Break
Bitcoin price is still trading in the mid-$30,000 price range for what has been more than 50 days now. Only a few weak attempts to push prices lower have been made, and bulls were able to defend each ...
Read More