Longtime market participant Matthew Hyland is confident that Bitcoin is poised for a bullish rally, and he outlined his predictions in a recent post on X (formerly Twitter).
Despite Bitcoin’s dip to $41,650 over the Christmas period, Hyland believes that the cryptocurrency is gearing up for significant price gains.
Hyland points to two key indicators, the Bollinger Bands and the Relative Strength Index (RSI), as signals for a short-term reversal in Bitcoin’s price.
He notes that the Daily Bollinger Bands are tightening, similar to the conditions that triggered previous price surges above $30,000 and $40,000.
Additionally, the Daily RSI is currently at a two-month low, and the 3-Day Moving Average Convergence Divergence (MACD) is on the verge of a crossover.
Bollinger Bands are a widely used volatility indicator that track Bitcoin’s price action and signal potential breakouts in volatility.
The narrowing of the daily-timeframe bands indicates that a new round of volatility may be on the horizon. This pattern has previously been observed in the lead-up to Bitcoin’s recovery above $30,000.
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The RSI, a momentum oscillator, provides insight into whether BTC/USD is overbought or oversold at a given price.
With an RSI reading of 53, Bitcoin is well below the overbought threshold of 70 and even further from its recent peak of 76 in December. This suggests room for further upside potential.
Longer timeframes also support the bullish outlook, as veteran trader Peter Brandt noted last week.
Hyland adds that the Daily RSI is currently at its lowest levels in over two months, a period when Bitcoin was trading below $27,000.
However, one potential obstacle to Bitcoin’s bullish trend is the Moving Average Convergence Divergence (MACD) on three-day timeframes, which is showing signs of a bearish trend flip.
Hyland acknowledges this, but he highlights that there are several days left for the MACD signal to potentially negate itself based on price action.
He also points out that the MACD has been accurate in predicting both lower and higher prices throughout the year.
In conclusion, Matthew Hyland’s analysis suggests that Bitcoin is on the verge of a significant bullish move, with multiple indicators aligning in favor of a price surge.
While the MACD presents a potential bearish concern, it remains to be seen how Bitcoin’s price action will unfold in the coming days.
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