I have been keeping a close eye on Bitcoin, and there are some big things happening right now that I want to let you in on.
You know what?
Bitcoin has given off a strong buy signal in the charts recently. This is a big deal as it means there might be an opportunity to join in.
Recently, Bitcoin’s price shot up after huge short positions worth billions of dollars were liquidated. It simply implies that many people who were betting against Bitcoin lost their bets and so its price rose up. That is just like when everyone expects rain only for the sun to come out instead.
However, what makes this really interesting is that Bitcoin’s price is flat-lining at the moment. Imagine looking at a ball rolling back and forth on the floor without going up or down exactly. There is sideway movement within this bull market which means generally Bitcoin has been uptrending.
Now, this is where things get interesting:
anything below $56,000 could mean trouble. It would be like the ball suddenly rolling off the edge of the table.
It might serve as a new low that could confirm a bearish trend (when prices are continuously decreasing). Nevertheless, if Bitcoin remains above $56,000, it may still be in the bull market and its price can keep rising.
Another thing to look at is the 3-day RSI (Relative Strength Index) for Bitcoin. This is a fancy term for a tool that helps us understand if Bitcoin is overbought or oversold. Right now, the RSI is below 50 which has often been a good sign to buy for long-term investors. It's like finding a sale on something you really want – a great chance to get in at a good price.
DXY or US Dollar Index is another factor to take into account. In this case, the index determines how valuable dollar is compared to other currencies. Bitcoin often goes down when DXY goes up and vice versa. At present, DXY is rising which is bad news for Bitcoin. We would like it if Bitcoin were to turn bullish in the short term by declining DXY. This would be like a low tide making it easier for boats (crypto) to rise.
So what does all this mean?
If you are considering investing in Bitcoin, perhaps now is a good time to observe keenly. The price may go up as long as Bitcoin stays above $56K since the overall trend remains bullish. The latest RSI levels indicate a possible buy opportunity for those with long-term views. And watch DXY – a fall there might lift bitcoin’s price.
However, remember that all investments come with risks so make sure you do your own research and maybe even consult with a financial advisor!
Happy investing!
Posted Using InLeo Alpha