Bitcoin Signals Potential Sell Signal After Reaching 3-Month High
Bitcoin has recently hit its highest price level since July, reaching $30,369 on Saturday. While this surge in price suggests bullish momentum, there are indications of a potential bearish reversal. Crypto analyst Ali points to the TD Sequential indicator, which hints at a sell signal.
The Potential Sell Signal
According to Ali, the market has been paying close attention to a potential head-and-shoulders pattern forming for Bitcoin on the daily chart. This pattern, combined with the TD Sequential indicator flashing a green 9 candlestick, suggests a potential sell signal. Additionally, the daily Relative Strength Index (RSI) reaching 74.21, a level that has historically triggered significant corrections, adds to the bearish outlook.
Ali states, “An impending price correction appears to be on the horizon unless BTC manages to clock a daily candlestick close above $31,560.”
If the resistance zone holds and the head-and-shoulders pattern is confirmed, Bitcoin could experience a retest of immediate support around $28,492. A further sell-off could even bring the price down to $25,000, which has been a bearish target in recent months. However, positive news regarding Exchange-Traded Funds (ETFs) could potentially catalyze a flip to the upside, with buyers targeting a run to the $40,000 area.
Overall, while Bitcoin has hit a 3-month high, it is important to keep an eye on these potential bearish signals. A sell-off may be imminent unless Bitcoin manages to sustain its price above key resistance levels. Traders and investors should closely monitor market developments and be prepared for possible market corrections.
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