Bitcoin Price May Return To $9,000 as Short-Term Bear Signals Flash 10

Bitcoin Price May Return To $9,000 as Short-Term Bear Signals Flash

Bitcoin (BTC) has found itself in the midst of a heavy lull. The cryptocurrency is down a mere 1% in the past 24 hours. This effective non-action has left some analysts stumped as to where the BTC price will head next, especially due to the micro-rallies and micro-crashes that have been observed over the past few weeks.

According to CryptoHamster, a popular trader, some short-term downside is likely. He remarked in a recent tweet that BTC has seen bearish divergences form on the one-hour time frame with the Stochastic, Stochastic Relative Strength Index, and Moving Average Convergence Divergence all trend higher while BTC has fallen, signaling weakness.

While divergences may seem like an abstract concept for readers, the important thing to know is that they have been playing out extremely well for Bitcoin over the past few days. In fact, CryptoHamster’s observation of these technical signals has allowed him to call a number of short-term price moves to a high level of accuracy.

Hamster isn’t the only one preparing for a price pullback.

Analyst Data Dater recently drew attention to a few signs that imply BTC will soon take a breather, which will be a move that will see the cryptocurrency head back into the $8,000s. He noted that indicators are “approaching overbought” on the four-hour, six-hour, and 12-hour charts, while the one-day chart and the two-hour chart are already flashing overbought signals.

Also, the BitMEX funding rate, which many say can be used to discover local tops and bottoms in the Bitcoin market, has been trending “very high for three consecutive periods.”

Bitcoin Bulls Still Have a Grip

While a short-term pullback is possible, the medium-term chart is still purportedly leaning in the favor of bulls.

Crypto Thies recently pointed out that Bitcoin is currently looking rather positive as the volume moving average implies incoming volatility. In the chart below, he showed that when BTC bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average.

He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Photo by zhao chen on Unsplash