Bitcoin, not a bird or plane, but the cryptocurrency that’s been on a soaring journey, has hit a roadblock. The latest bull run, which lasted over a year in an upward trend, has encountered its first obstacle.
The rally came to a halt because of a powerful sell signal that acted like a strong barrier, and now Bitcoin might be at risk of turning in the opposite direction.
Bitcoin’s Mixed Signals: A Look at Buy and Sell Indicators
Bitcoin’s price journey has been marked by numerous buy signals since hitting a low in late 2022. The rally throughout 2023 saw BTCUSD surge by over 300%. However, on longer timeframes, like the monthly chart, sell signals persist.
One notable indicator is the 1M SuperTrend, a robust trend-following tool designed by Olivier Seban. Despite Bitcoin’s impressive climb, especially evident in CME BTC Futures, a singular sell signal on the 1M timeframe remains unchanged. This indicator, known for its reliability, continues to hold its ground, raising questions about the potential for a reversal, even as BTCUSD tests its boundaries this month.
Bitcoin smashes into SuperTrend resistance | BTCUSD on TradingView.com
SuperTrend Dynamics: Bitcoin’s Battle with Resistance
The SuperTrend, a tool displaying dynamic support and resistance lines on a price chart, plays a crucial role in signaling shifts in market sentiment. When the price breaks through this line upon closing, the sell signal transforms into a buy signal, and vice versa.
Presently, the SuperTrend highlights a critical downtrend resistance at $44,621, just a tad higher than December 2023’s closing around $44,200. Bitcoin has attempted to breach this resistance, but it continues to trade below this level. A significant victory for crypto investors would be a January close above the SuperTrend line. However, the possibility of a breakout might unfold later, possibly in February or March, following a period of sideways consolidation beneath the resistance.
Could this signal cause the mid-cycle correction? | BTCUSD on TradingView.com
SuperTrend Analysis: Bitcoin’s Path to New Highs
A closer examination reveals that the prospect of breaking through the SuperTrend on the 1M timeframe in BTCUSD may not swiftly lead to new all-time highs, contrary to initial expectations.
Historically, following a SuperTrend buy signal, Bitcoin has experienced a mid-cycle correction, setting it back by several months. However, this correction typically occurs after the buy signal has been generated. The question arises: could the current situation be different?
The charts referenced in this discussion were initially featured in the CoinChartist VIP 2024 preview and issue #32 titled “This Time It’s Different,” providing insights into the unique dynamics at play in the current Bitcoin market.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
Join Cryptos Headlines Community
Follow Cryptos Headlines on Google News
