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Bitcoin has been on the rise for the past two days. After surpassing $ 7,800 on Tuesday night, the cryptocurrency entered a strong uptrend that did not experience serious setbacks until BTC was able to hit $ 9,500 – 36 hours later. This marks a 20% recovery from the lows.
The move caught the merchant largely unprepared. As reported by crypto derivative data site Skew.com, over $ 100 million in BitMEX short positions were liquidated during the recovery of $ 7,800.
However, the bears could soon shine with reports of a “perfect reversal” on Bitcoin’s daily chart. Bitcoin faces a strong reversal.
According to a cryptocurrency trader, Bitcoin’s one-day chart recently printed a “perfect” bearish signal: a doji candle after recovery from $ 7,000 to $ 9,000, characterized by an opening and closing price that is “practical” is the same, “as Investopedia describes.
Doji candles indicate “indecision” in market trends
As Bitcoin has seen steady gains in the past week or two, indecision would indicate a possible return to a downtrend. In fact, the trader explained that the doji candle “like [eine] perfect investment in doji [dem Trend] it looks “.
The analyst also notes: Tom Demark Sequential is very likely to print a “9” signal for Bitcoin tomorrow. Candles “9”, as suggested by the TD Sequential, are located near or at the points where trends are reversed. This further supports the estimate that BTC will soon return to $ 7,000.
Do not underestimate the case of the bull
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While a short-term pullback towards $ 7,000 is possible, as the trader shows, many believe that the medium-term outlook is slowly turning bullish.
Prominent analyst Alex Krüger, for example, believes that despite the recent loss of bullish momentum, suggesting that analysts are on the downside, Bitcoin’s recovery has been “very bullish” in recent days.
Krüger cites information on the derivatives market to underpin this sentiment. It points to low refinance rates on futures exchanges, flat aggregate open interest on Bitcoin futures contracts, and falling open interest on BitMEX contracts.
This, he writes, suggests that Bitcoin’s move “was fueled by spot buyers rather than excessive leverage.” Of course, excessive leverage will have to be removed at some point, while spot buyers can keep their coins as long as they want, giving the bull additional credibility.
At the same time, Google Trends data indicates that requests for the term “Bitcoin halve” have skyrocketed to the highest level ever recorded.
Halving is an event that will reduce BTC’s inflation rate by 50%, which will decrease the amount of coins that mining companies can sell.
The point: half is only two weeks away, and some analysts believe that BTC will continue to gain momentum once this critical event occurs.
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