Bitcoin Ready To Dump… Maybe
While Bitcoin saw a drawdown from $5,450 to $4,950 on Thursday, BTC’s Relative Strength Index (RSI) reading remains at somewhat overbought levels. HornHairs, an industry analyst, recently drew attention to this fact, explaining that the technical’s movements over the coming days should be a topic of focus for traders across the board.
He explains that crypto investors shouldn’t “sleep on one-day RSI bear divergences,” adding that the last two times Bitcoin looked as it did on the RSI, a retrace to the “previous swing low” that forced the indicator to turn oversold occurred, rather than a continued rally higher. In early-2018, this pattern saw BTC lose 70%. In mid-2018, the second iteration of this pattern saw BTC collapse by 42% in a matter of two months.
$BTC Don't sleep on 1D RSI bear divs. Last 2 led to a move back to the previous weekly swing low as well as a retrace on the RSI from the overbought region to oversold over the span of ~55 days. That puts us around $3k come June if a similar situation unfolds. That said… pic.twitter.com/LXHdc7qO1I — HornHairs