RSI divergence is forming on Bitcoin (BTC). Will this week be marked by a corrective movement? It’s possible. Check out this analysis.
Bitcoin (BTC) Bullish Impulse Loses Momentum
The crypto market starts the week with very little volatility. BTC, the leading crypto by market capitalization, failed to break out of the weekend high and low. Indeed, its price was less volatile today than during the weekend sessions. Is the bullish momentum since the start of the year losing momentum? It appears to be. Then, we can also see the formation of an RSI divergence on the 1h chart of Bitcoin (BTC). We could envisage a corrective movement this week.
Sure enough, several bearish signals are starting to show up on the short-term chart. In particular, there is the appearance of the divergence of the RSI. This is a very relevant bearish pattern, as it shows the diminishing bullish pressure. Thus, we could therefore consider a slight drop in bitcoin (BTC) for the next few days. But not that, we also note the presence of a resistance zone around $24,000. This hurdle could serve as an entry point for a short-term trade.
Take advantage of a potential pull-back?
Given these bearish signals, one could envisage a potential pull-back on bitcoin (BTC). However, it would be wiser to go short tomorrow. Indeed, the markets tend to achieve the peak, or trough, of the week on Tuesday. Thus, one could envisage a slight rise in the price on the resistance around $24,000. It will be in this zone that we will place our sell order, placing the stop loss on $24,500. The objective will then be placed on the psychological support of $20,000. This is a criticism that could, again, restart the bitcoin (BTC) bull-run.
In the medium term, the price structure remains bullish. We are only trying to take advantage, as a crypto day trader, of a potential corrective movement. Indeed, in the long term, there is a good chance that bitcoin (BTC) will cross $25,000. Then, the adoption of cryptos, which seems inevitable, could play a catalytic role for the rise of BTC.
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