The world’s largest cryptocurrency Bitcoin (BTC) saw a healthy bounce on Sunday from $40,000 after six days of flatness. The $40,000 level serves as a key psychological level for Bitcoin, below which analysts have warned it could trigger another major sell-off.
As of press time, Bitcoin is trading at $41,977 with a market cap of $794 billion. However, BTC price is currently trading at a three-month low, and any further negatives could lead to a major downside. So is the bottom near and are we looking for a trend reversal? Well, anything can happen in the crypto space but here are some indicators that can help us make a nuanced call.
The Bitcoin RSI is already at its lowest point, indicating that we are in oversold territory. On the daily chart, Bitcoin RSI has hit a two-year low. Most recently, these levels were seen in March 2020 and May 2021.
#Bitcoin The RSI has been at this low only 2 other times in the past 2 years. Looks like a bottom has come and bounced. Let’s see pic.twitter.com/qhQ1pD8yEl
– Bitcoin Archive (@BTC_Archive) January 9, 2022
Is Bitcoin Heading to $50K?
There can be strong predictions that bitcoin could head towards $50,000 and beyond. However, it will have to break through some key resistance levels to reach this mark. Renowned Crypto Analyst CRYPTOBIRB write:
The most interesting $BTC for me is $46266 – the main resistance for the whole correction. A strong close above is an early sign of an extension to 50-60k. While at the leaderboard: I am expanding my team of technicians.
Another popular market analyst TechDev presents a detailed look at Bitcoin impulses and corrections based on historical cycles. He said that there is still an upward impulse in Bitcoin before we can head to the bear market cycle. In its recent Bitcoin analysis, TechDev writes:
Most likely the outcome for me remains another upward impulse, before the start of the impulsive *downward* trend that defines a true bear market for me.
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My opinion about #Bitcoin pulses and corrections over cycles.
We’re still in the midst of the adjustment we’ve been making for most of 2021.#Bitcoin hasn’t moved since February. pic.twitter.com/xbMX8IG4JI
– TechDev (@ TechDev_52) January 8, 2022