Let’s examine the insights shared by our Technical Analyst at UseTheBitcoin as he walks us through his personal trading approach and observations on the crypto market.
Bitcoin (BTC) Market Update
After Bitcoin peaked at around $73,000, it has been in a downtrend for roughly 188 days. During that time, we have seen consecutive lower lows, and it is no secret that many people have started losing interest in Bitcoin, mainly due to the constant selling pressure. However, there are signs that Bitcoin could be on the verge of a new trend.
We’ve been tracking the charts closely, and something exciting is starting to show up on the daily timeframe—a bullish divergence. Now, if you are not familiar with what that means, do not worry. Basically, while Bitcoin’s price has continued to move downward, the Relative Strength Index, or RSI, is quietly moving upwards. This is significant because when price and RSI move in opposite directions like this, it is often an early sign that a trend reversal could be just around the corner.
So, let’s plot the trend lines on the chart. You will notice that Bitcoin is still drifting lower, but the RSI is climbing higher. This is an important signal because it suggests that even though the price is dropping, the underlying momentum is starting to shift. But, and this is a big ‘but,’ this is not likely to happen overnight. It could take days or weeks to see any major move upward, so patience is key here.
So, if you are a risk-taker, the $58,200 to $58,400 range could be a good area to position yourself, as it is already touching key Fibonacci levels. You can then place a stop-loss around the $56,400 level.
Economic Data
Now, let’s talk about something else that’s crucial—timing. While the chart shows some bullish signs, we also have a few important dates on the market calendar: September 17th-18th, 19th, and 20th. These dates will be critical for all traders, not just those in crypto, because the traditional markets could experience volatility due to economic reports or announcements.
Even though the crypto market is not directly influenced by these events, remember that people are still driving the market. When there is fear or uncertainty in the broader financial world, it tends to spill over into crypto. So, the general sentiment could shift, and we might see some sharp price movements in Bitcoin and other assets. Be careful—this week could be highly volatile, and it might even invalidate some of our bullish bias if things do not play out as expected.
Lastly, let’s not forget the election. That’s still a few months away, but it’s probably the biggest market mover we’ll see in the near future. Leading up to it, we’re likely to experience lots of volatility, but I’m optimistic that by the time we hit October, the trading environment will improve, and we might start seeing clearer signals for those of you looking to make a move.
Final Thoughts
In summary, if you plan to invest, now is the time to prepare your cash. And if you are already in a position, make sure your stop-loss levels are set and tight to protect your capital.
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