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Bitcoin’s key momentum metric just flashed bearish with BTC price pinned under $50K

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Bitcoin’s key momentum metric just flashed bearish with BTC price pinned under $50K

The run-up in the Bitcoin (BTC) price toward $50,000 last week risks exhaustion due to a mismatch between the cryptocurrency’s price and momentum trends.

So it appears the Bitcoin’s price and relative strength index (RSI) have been moving in the opposite direction since late July. In doing so, even a strong push higher in the BTC/USD bids has coincided with lower peaks in momentum, suggesting that the pair’s upside momentum is weakening out.

Bearish divergence

A normal RSI momentum tends to tail the price action. That said, it rises when the price rises and falls when the price drops. But in some cases, the RSI deviates from pursuing the price trends, leading to a so-called RSI divergence.

Technical analysts consider RSI divergence as a powerful signal to spot price reversals. For instance, a bullish divergence, wherein the price falls and RSI rises, prompts traders to buy the asset in anticipation of a rebound. Similarly, a bearish divergence—featuring rising prices and falling RSI—prompts traders to take profits at the top while expecting a pullback.

The Bitcoin daily chart below shows the cryptocurrency in bearish divergence.

BTC/USD 1D chart featuring bearish divergence. Source: TradingView.com

The downside signal appears as Bitcoin struggles to break bullish above $50,000. As of Sunday, the benchmark cryptocurrency was trading at $48,387, or 4.19% lower from its three-month high of $50,505, achieved on Aug. 3, following a similar 72.36% upside boom.

Good morning!$BTC has broken the ltf bullish structure. Main target remains $38k as long as it stays below $50k

If it finally drops to that level, buy as much as you can

— il Capo Of $NOIA (@CryptoCapo_) August 29, 2021

On the other hand, Bitcoin’s daily RSI initially rallied in sync with prices but topped out on July 30, which was way ahead of price, hitting $50,505. Since July 30, the Bitcoin price formed a sequence of higher highs while RSI printed lower highs, suggesting a weakening upside momentum.

A similar bearish divergence between January and April 2021 was instrumental in predicting a Bitcoin price drop, as shown in the chart below.

Bitcoin price-RSI divergence from January-April 2021 period. Source: TradingView.com

Bullish indicators

The bearish divergence signal comes as Bitcoin holds strongly above $30,000, amidst anticipation that it would become a hedge of choice among accredited investors against inflationary pressures.

The perception has led many analysts, including investment researcher Lyn Alden and Fundstrat CEO Tom Lee, to predict a $100,000 valuation for the cryptocurrency in 2021.

On Friday, Bitcoin price shot upward by $1,500 in an hour after Federal Reserve Chairman Jerome Powell presented a pro-inflation, dovish policy outlook at this year’s Jackson Hole symposium.

As a result, the biggest bullish indicator for Bitcoin remains the Fed’s aggressive $120 billion a month asset purchase program, coupled with its near-zero interest rate policy.

Related: Bitcoin price stages a comeback as 3 indicators reflect BTC’s strength

The strong fundamental has prompted technical analysts to envision a long-term uptrend in the Bitcoin market. Namely, independent market analyst Teddy Cleps presented a bullish outlook for the cryptocurrency, based on key wave support that acts as an accumulation area for traders.

Bitcoin 4H chart featuring wave support. Source: Teddy Cleps, TradingView.com

Similarly, Ryan Clark, another market analyst, noted that Bitcoin has been merely consolidating below $50,000 just like when it was trading below $24,000 before the December 2020’s bullish breakout.

Bitcoin under 50k level acting like when it was under the 24k level.

Higher soon.

— Ryan Cantering Clark (@CanteringClark) August 28, 2021

On the other hand, TraderXO noted that Bitcoin could still fall towards the $39,000-40,000 area but remained convinced that the cryptocurrency would log an attractive rebound from the lower range.

The analyst marked Bitcoin’s all-time high near $65,000 as its long-term upside target.

$BTC

Taken significant profits around 48-49k – no daily close above 49k – until that happens then will look for higher prices.

Equally open towards the probability of buying opportunities around the 39-42’s in Sept

Only interested in HTF swing trades. pic.twitter.com/jjvAFkCwmV

— TraderXO (@Trader_XO) August 29, 2021

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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BTC, ETH, XRP, ZEN, SNX, WAVES, AVA – Technical Analysis Sept 16

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BTC, ETH, XRP, ZEN, SNX, WAVES, AVA – Technical Analysis Sept 16

Bitcoin (BTC) and Ethereum (ETH) have broken out from descending parallel channels.

XRP (XRP) is trading above the $1.05 horizontal support area.

Horizen (ZEN) is trying to break out above the $108 resistance area.

Synthetix (SNX) has broken out from an ascending triangle.

Waves (WAVES) has moved above the $26.80 resistance area.

Travala.com (AVA) has broken out from a descending resistance line.

BTC

BTC has been moving upwards since Sept 14. On Sept 15, it managed to break out from a descending parallel channel and accelerated. 

The upward move is supported by both the RSI and MACD, which are increasing. The former has even crossed above 50. 

BTC is approaching the 0.618 Fib retracement resistance level at $49,050. However, due to a confluence of Fib levels, it’s possible that it could increase all the way to $50,750.

ETH

On Sept 15, ETH broke out from a descending parallel channel that had been in place since Sept 7. It has been increasing at an accelerated rate since. 

The upward move is supported by both the increasing MACD and RSI readings. 

However, ETH has reached a confluence of Fib resistance levels between $3,625 and $3,635. These levels are the 1:1.61 length of waves A:C and the 0.618 Fib retracement resistance level (white).

XRP

On Aug 13, XRP broke out from the $1.05 horizontal resistance area. It proceeded to reach a high of $1.41 on Sept 6 before dropping sharply the next day. 

Following this, it validated the $1.05 area as support. 

However, even though XRP is trading above the $1.05 support area, indicators are bearish. The MACD and RSI are both decreasing.

ZEN

ZEN has been increasing above an ascending support line since July 16. On Sept 6, it was rejected by the $108 horizontal resistance area and returned to validate the support line once again. 

However, ZEN rebounded and made another breakout attempt on Sept 15. 

Despite the strong bounce, ZEN failed to break out. In addition, both the RSI and MACD have created bearish divergences. 

Therefore, at the current time, we cannot determine if ZEN will be able to move above this resistance.

SNX

SNX began trading inside an ascending triangle on May 21. After several unsuccessful attempts, it managed to break out on Sept 15. 

The breakout is supported by the increasing MACD and RSI values. 

The closest resistance area is found at $23.80.

WAVES

WAVES has been increasing above an ascending support line since July 20. 

On Aug 31, it broke out above the $26.80 resistance area. 

After this, it returned to validate the area as support, also touching the ascending support and Supertrend lines (green icon). It has been moving upwards since. 

The closest resistance area is at the all-time high level near $38. 

AVA

On Aug 14, AVA broke out from a descending resistance line that had been in place since April and reached a high of $5.40 on Sept 6. 

However, it was rejected by the $5.40 resistance area and fell. 

It then found support at $3.50, creating two lower wicks. In addition to this, the RSI has generated a hidden bullish divergence, which is a common sign of trend continuation.

Therefore, AVA could be on its way to revisit the $5.40 resistance area.

For BeInCrypto’s latest Bitcoin (BTC) analysis, click here.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

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AMC to Support Ethereum, Litecoin, and Bitcoin Cash Following BTC Adoption

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AMC to Support Ethereum, Litecoin, and Bitcoin Cash Following BTC Adoption

AMC Theatres will accept payments in Ethereum, Litecoin, and Bitcoin Cash by the end of 2021, in addition to bitcoin.

AMC Theatres, the world’s largest theater chain, has announced that it will accept more cryptocurrencies for payment by the end of 2021. The cryptocurrencies that it will support include bitcoin, ethereum, litecoin, and bitcoin cash. This marks yet another notable adoption for the cryptocurrency market, which has had a stellar 2021.

AMC expands crypto payment options

The company’s CEO, Adam Aron, tweeted the news on Sept 16, saying that crypto could be used to pay for online ticket and concession payments by the year’s end. AMC revealed that it would accept bitcoin in August 2021, to much fanfare.

This year has already seen Tesla accept bitcoin as payments for its electric vehicles, though it suspended that later. PayPal has also expanded into cryptocurrencies and is ramping up its support for the market.

The news of AMC Theatres accepting cryptocurrency payments will please investors, as the chain is a notable brand with some clout. The firm has also come to the attention of the public lately for its support from within Reddit’s wallstreetbets community. While the support was not quite as strong as it was for GameStop, those retail investors have helped drive the price of AMC’s stock up.

In short, the acceptance of crypto payments should stir further interest from a community that is already knowledgeable about crypto. Incidentally, GameStop also announced a foray into the blockchain and crypto space when it announced that it was working on a series of NFTs.

Bitcoin and crypto steadily seeing greater adoption

The crypto world has been subject to a lot of good news in terms of adoption this year. The support coming for crypto payments has been varied, with entities in a highly varied set of industries taking the step. The signs have been very optimistic at the retail level.

The travel industry can benefit a great deal from bitcoin payments — and a luxury hotel in Switzerland has gone to facilitate that. Switzerland, which is known for its hub of crypto companies and entrepreneurs, has over 85,000 merchants supporting crypto payments.

Other established companies supporting crypto payments include auction house Lloyd’s. Auction houses have been very interested in blockchain technology, particularly NFTs. Many of them have conducted auctions for NFTs, selling them for many millions.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

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El Salvador’s Chivo Bitcoin Wallet Crosses 500,000 Users

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El Salvador’s Chivo Bitcoin Wallet Crosses 500,000 Users

El Salvador’s Chivo bitcoin wallet has already crossed 500,000 users, as revealed by local news reports.

El Salvador’s digital bitcoin wallet Chivo has already hit half a million users, according to reports from local media. The country introduced the wallet on Sept 7.

Users receive $30 in bitcoin when they download the wallet for the first time as an incentive. As of Sept 7, the country had purchased 400 bitcoins for its coffers — which by all accounts is ambivalent in terms of its success.

El Salvador’s bitcoin integration is off to a somewhat rocky start, as there have been several protests against its adoption. Protests have come from both opposition forces and citizens — with the latter marching in the streets and even filing a lawsuit.

The country has used a number of measures to incentivize people to use bitcoin. Foreigners, for example, are exempt from paying capital gains tax on their bitcoin profits. In addition, they receive permanent residency if they decide to move and have an entrepreneurial venture.

https://s32659.pcdn.co/wp-content/uploads/2021/09/El-Salvador.mp4
Source: /u/kiarga

Some El Salvadorians have taken to Reddit to talk about the general sentiment surrounding bitcoin. The country celebrated its Independence Day on Sep. 15, and many protested against the current government in the streets. News broke that vandals destroyed bitcoin ATMs in the country, which is further evidence of displeasure with the new law.

One Redditor spoke about bitcoin further cementing existing inequalities — a concern that was one of the major issues citizens have with the government. They also note that the bitcoins in the Chivo wallet could be seized by the government.

One thing that cannot be denied is the fact that BTC payments do indeed reduce costs for cross-border payments. Other countries in the region are keeping a close eye on the development, which is the first of its kind.

Will more countries follow?

It’s unlikely that a large swathe of countries will follow El Salvador’s lead. Most governments are determined to release their own central bank digital currency (CBDC). Those that have accepted cryptocurrencies as an asset class have done so begrudgingly and are laboring to form a regulatory framework.

The idea of making bitcoin legal tender has been rebutted by China, India, and Russia. With important economies dismissing the asset as having such an important role in the economy, most other countries will likely take the same position.

Having said that, the El Salvador bitcoin experiment could turn up some surprising results. If bitcoin does indeed become the medium for cross-border transactions, then this could encourage more countries to do the same.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

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