Bitcoin price has been rising over the past week, but the asset may be entering ‘overbought’ territory.
Bitcoin has made an impressive 22% in the past week. This move has pushed the price to a new 2023 high of $21,356 during the Asian trading session on Wednesday.
Furthermore, the crypto rally has pushed BTC above several key technical indicators. This may suggest that a bear market bottom has been formed and a new uptrend is developing.
The 200-day simple moving average (SMA) is often used as a “litmus test for macro market trends,” according to Glassnode.
The analytics provider noted that this week’s rally pushed BTC price above this key level, mirroring moves seen in previous cycles.
“Bitcoin markets often express a strangely frequent cyclical behavior, with this cycle trading below the 200D-SMA for 381 days, which is just 5 days shy of the 386-days in the 2018-19 bear market. “
bitcoin rsi high
Another key technical indicator is the realized price (RP). According to Woo Charts, Bitcoin broke through this level which is currently at $19,753.
Actual value All coins in circulation are valued at their last transferred value. Additionally, it can also be considered as an estimate of how much the entire market paid for their BTC.
However, the asset price still has a way to go to reach the 200-week EMA. This macro trend indicator is currently at $24,566.
While the short term outlook is bullish, another indicator is showing overbought signals. The daily Relative Strength Index (RSI) for bitcoin is currently below 90, which is from a higher high. A retracement usually occurs when the RSI reaches these levels.
From a market sentiment perspective, Bitcoin is now back in neutral territory on the Fear and Greed Index. This is the first time that BTC has come above 50 in the sentiment index since April 2022.
BTC Price Outlook
At the time of writing, BTC was changing hands for $21,275 after three days of consolidation. There has been little movement in the past 24 hours, but analysts expect another upside move.
The next level of resistance is near $24,000, which was last seen in August 2022. However, a decline to the downside will find support in the $18,000 price area.
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