Bitcoin continues to impress by reaching an all-time high of $111,970. However, the price has slightly retraced to $110,700. Analysts note mixed signals regarding the market's overheating.
Bitcoin's New Record
On May 22, Bitcoin reached its all-time high of $111,970. However, the price has corrected to $110,700. This raises questions about whether the current market is overheated or if this is merely a healthy profit-taking phase.
Market Condition Analysis
Analysts assert that Bitcoin shows no signs of overheating despite its recent all-time highs. According to CryptoQuant analyst Crypto Dan, "Overheating indicators such as funding rates and capital inflow remain low compared to previous peaks." He also added that "profit-taking by short-term investors is limited."
Overheating Indicators and RSI
Bitcoin's relative strength index (RSI) indicates overbought conditions in two out of five timeframes, reaching 70 in the 12-hour timeframe and 75 on the daily chart. However, the risk of a correction is not guaranteed, and Bitcoin could continue to rise, supported by increasing spot ETF demand and easing trade war tensions.
Despite the increasing interest in Bitcoin and the establishment of a new record, analysts believe that the market remains in a healthy upward phase. Nonetheless, it is essential to monitor changes in the RSI and other metrics to assess potential corrections.
