Bitcoin (BTC) Price Watch: Bullish Divergence Spotted

Bitcoin Price Key Highlights

  • Bitcoin price is still hovering above the long-term support around the $6,000 area.
  • A bullish divergence can be seen, suggesting that a bounce may be in order.
  • Moving averages, however, still indicate that more losses are in the cards.

Bitcoin price is still testing the long-term floor, and a bullish divergence signals that a bounce may happen.

Technical Indicators Signals

The 100 SMA just crossed below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. This suggests that the selloff is more likely to resume than to reverse or that support is more likely to break than to hold.

However, RSI formed higher lows while price had lower lows, creating a bullish divergence. The same is the case for stochastic as it also had higher lows in the same period. Both oscillators are already climbing out of the oversold region to signal a return in bullish pressure.

In that case, bitcoin price could draw enough momentum to test the nearby area of interest around $6,800 to $7,000 around the moving averages’ dynamic inflection points. Gains beyond those levels could take bitcoin price to the $8,000 area of interest next.

BTCUSD Chart from TradingView

Market Factors

Another round of negative commentary came from ex-PayPal CEO Bill Harris who mentioned in an interview to CNBC:

“The cult of bitcoin [makes] many claims — that it’s instant, free, scalable, efficient, secure, globally accepted and useful — it is none of those things.”

He added that there’s “no value there” and that bitcoin price will continue to fall, likely spooking even more traders to liquidate their holdings.

Take note, however, that bitcoin has reached record highs to the Turkish lira earlier in the week, but the rebound in the currency has also erased those gains. Still, a continuation of risk-off moves on these contagion fears could drive investors to alternative assets like crypto.

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