Cryptocurrency trader CJ has drawn attention to his analysis of Bitcoin's Relative Strength Index (RSI), indicating possible changes in the bullish momentum.
Key Insights from CJ's Analysis
CJ explained that during bull markets, Bitcoin's RSI typically stays above 70, indicating strong momentum. A drop below this level often signals a weakening trend, with 40 being a key support level during bear markets. In the current market cycle, Bitcoin’s RSI briefly entered overbought territory but has since declined to 58.34. This decline indicates a potential loss of momentum and could signal the end of the current bullish run. CJ also pointed out that RSI highs have progressively decreased across the last three major market cycles (2017, 2021, and 2024). This trend suggests waning bullish momentum over time, raising concerns about Bitcoin’s ability to sustain its upward trajectory.
Cautious Optimism with Potential Downside Risks
While CJ remains cautiously optimistic about Bitcoin’s long-term outlook, he advises traders to prepare for potential downside risks. With the RSI trending lower, there is a possibility that Bitcoin could face increased selling pressure, especially if the market does not regain its previous momentum.
Conclusion
CJ's analysis of Bitcoin's fading bullish momentum by the RSI highlights a potential turning point for the current bull cycle. With the RSI dropping below 70 to 58.34, traders are advised to remain cautious and prepare for potential risks. The coming weeks will be critical in determining whether Bitcoin can regain its bullish trend or face further corrections.
CJ's warnings of fading Bitcoin momentum by RSI advise traders to approach the current market cycle with caution. The coming weeks will be crucial in revealing whether Bitcoin can reclaim its bullish momentum or if further corrections are on the horizon.
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