Bitcoin’s chart is currently showing a major hidden warning signal, indicating potential challenges ahead. According to analyst Josh of Crypto World, despite the short-term strength in price, there is a hidden bearish divergence that could suggest a continuation of the larger bearish trend.
The significant flashing signal on the daily Bitcoin chart is a “hidden bearish divergence.” This occurs when Bitcoin’s price displays lower highs while the RSI (Relative Strength Index) shows higher highs. Typically, a bearish divergence indicates that the market may continue its downward trend. However, in this instance, the signal has not been fully confirmed yet. Here is a detailed breakdown of his analysis:
Key Resistance and Support Levels to Monitor
Bitcoin is currently encountering resistance around $64,500. If it manages to surpass this level in the coming days, the short-term bullish trend could persist. Conversely, if the price struggles to break through, we may witness a continuation of the bearish trend.
On the downside, support levels are situated around $63,000 and further down between $60,200 and $61,200. These levels are crucial to monitor for any potential price breakdown.
Another critical factor impacting Bitcoin, Ethereum, and Solana at present is that they are all displaying overbought signals in the short term. An overbought market suggests limited room for price growth unless there is a reset. A short-term pullback or sideways movement could assist in “resetting” the RSI and creating space for another upward push.
What Lies Ahead for Bitcoin?
We are currently in a short-term bullish trend, but this could change rapidly. If Bitcoin successfully breaks the $64,500 resistance, it could potentially target $79k, a significant resistance level based on historical market behavior. Conversely, failure to breach the resistance could result in a resurgence of the bearish trend. Over the next few days, it will be crucial to watch for confirmation of either a breakout or a continuation of the bearish trend.
