Bitcoin’s latest surge brought the price to $119,500, but indicators suggest that it may be time for a pullback to consolidate gains. Key points:
- Bitcoin might be peaking at $119,500 as key price indicators signal an “overbought” condition.
- Traders are expecting a support retest after a rebound nearing 10% over the past week.
- Inflows into ETFs have reached $1.6 billion in just three days, with IBIT entering the top 20 for assets.
Traders caution that BTC/USD might dip after reaching a six-week peak above $119,000.
RSI Indicates a Break is Needed
Bitcoin experienced nearly a 10% growth this past week, marking a resurgent bull cycle. Recent data shows it climbed over $119,500 on Bitstamp, but analysts predict a cooling-off period is required before any sustained upward movement.
“Everything is overbought but no signs of initial weakness. Simple breakout & retest.”
Among the supporting arguments for a market pullback is the relative strength index (RSI), which sits in “overbought” territory at approximately 90/100—the highest reading in four hours since July, when it first surpassed $123,000.
Bitcoin ETFs Drive Positive Sentiment
Continuing discussion on the RSI, Caleb Franzen identified a bullish divergence in Bitcoin against the S&P 500 recently.
This observation stemmed from evaluating the largest US spot Bitcoin ETF, BlackRock’s iShares Bitcoin Trust (IBIT).
“Bullish RSI divergence for Bitcoin relative to the S&P 500 (IBIT/SPY).”
Data from Farside Investors indicated more than $1.6 billion net inflows into US ETFs this week, with IBIT contributing $600 million.
Furthermore, Eric Balchunas noted IBIT’s ascent into the top 20 largest ETFs based on assets.
“It may not take long to reach the top 10—it took in $40 billion over the last 12 months and has risen by 85%.”
This report includes no investment advice and encourages readers to conduct their own research.
