Cryptocurrency traders, having seen bitcoin largest cryptocurrency, rebounded overnight to $64,000 from recent lows below $60,000, you may be wondering if a bottom has been hit and a new bull run has begun.
There is a simple signal to get that confirmation. Right now it is said that the rebound has not begun.
That signal comes from the widely followed momentum indicator called the relative strength index or RSI. The measure can range from 0 to 100. Readings above 70 indicate that an asset is getting hot and potentially overbought, while readings below 30 suggest the opposite. Between those extremes, specific levels often emerge as dividing lines between bullish and bearish environments.
For the price of bitcoin, the line is at 41.5, according to crypto data analysis platform Material Indicators. Above that level, BTC has historically had a stronger argument for being in a macro uptrend. Below it, bearish pressure tends to dominate.
“Right now, Bitcoin is down and still trending lower,” Material Indicators analyst Keith Alan said in an email. “That doesn’t mean the price has to collapse, but it does mean the burden of proof still falls on the bulls.”
