Bitcoin bulls must be frustrated with the recent lethargic price movement. Regardless, Bitcoin has been moving in a fairly tight range in relation to historical volatility since it struck resistance near the $30k level.
However, the same thing happened in the forex market. Volatility has remained low since the EUR/USD surpassed the critical 1.10 level, and traders are now waiting to see what happens next – more upside or a reversal of the bullish trend.
The two are linked.
When comparing the EUR/USD rally from 0.95 to the Bitcoin rally from $15,000, parallels cannot be overlooked.
When confronted with this ambiguity, it is typically beneficial to consider the wider picture and interpret charts. As a result, the bias towards Bitcoin’s value is bullish.
So, here are two technical reasons to buy Bitcoin (or sell the US dollar):
In 2023, the RSI remains over 50.
The weekly chart shows a rising triangle if RSI remains over 50 in 2023.
The Relative Power Index (RSI) is the primary technical bullish setup for Bitcoin. The RSI is an oscillator that is sometimes shown on the backside of a chart.
The weekly chart above focuses on Bitcoin’s comeback from the 2022 lows. The increase from $15k to more than $30k resulted in the RSI jumping above 50.
The RSI “oscillates” between overbought and oversold levels, denoted by 70 and 30, respectively. Technical merchants deal with the 50 mark when they are in between ranges. Specifically, when the RSI crosses over 50, the market is bullish; when it crosses below 50, the market is bearish. In fact, retailers should be aware of false breakouts.
However, the timescale above (weekly) shows that there is no such thing as a fake breakout. Only the other, given that the value movement has been over 50 from the beginning of 2023.
As a result, the bias remains optimistic as long as the RSI remains above 50, and the next move should be a climb into overbought territory.
An ascending triangle sample suggests a transfer of more than $45k.
An ascending triangle is a bullish sample distinguished by the worth motion pushing against horizontal resistance. Its measured transfer equals the longest segment of the triangle formation and feeds into further gains into the $45k range.
However, there is one exception: the value movement should remain above $25,000. If it happens, the RSI will remain above 50, indicating that Bitcoin’s value will eventually build enough power to break through horizontal resistance.
