CMT-Certified Expert Explains Why Bitcoin May Not Reach Past Extremes On Indicators

Source Newsbtc

A crypto market technician is debating whether Bitcoin has reached its peak this bull cycle, as technical indicators suggest a potential loss of momentum. The analysis report highlights technical indicators like the Relative Strength Index (RSI) which failed to reach past extremes, raising concerns about Bitcoin’s future trajectory.

Bitcoin Indicators Fall Short Of Historical Peaks

Bitcoin has historically exhibited strong indicator readings during major cycle tops, reflecting extreme market engagement and enthusiasm. However, in this bull cycle, the pioneer cryptocurrency’s RSI reading has failed to reach historical peaks despite Bitcoin reaching new all-time highs. 

Tony Severino, a crypto market technician on X (formerly Twitter), has Bitcoin Price Risks Further Crash As S&P Monthly LMACD Turns Bearish, Why Bulls Have Only 20 Days a detailed analysis of Bitcoin, challenging the assumption that the cryptocurrency must reach the same overbought RSI levels as in previous cycles to confirm its market peak. The key argument here is that lower highs on oscillators like the RSI, combined with higher highs in Bitcoin’s price, can be a bearish signal, suggesting waning strength in the market. 

Severino shared an example comparing Bitcoin’s current bull cycle to past cycles. In the previous bull market, Bitcoin’s monthly RSI reached above 90, but its current cycle has not. The analyst posed a question about whether this inability to reach past extremes means that Bitcoin hasn’t reached a market top or simply lacked the same momentum to push its RSI to the highest level. 

Bitcoin

The analyst has warned that believing that Bitcoin must reach past extremes on indicators before hitting a price peak is a dangerous way of thinking. Historical patterns do not always repeat in the same way, and relying too much on past indicator peaks could cause traders to miss warning signs of a top or underestimate the possibility of a bear market. 

Severino also pointed to historical data from the S&P 500 in the 1950s and 1960s, where similar RSI failure preceded a long market meltdown. During these times, cyclical peaks hit RSI readings of 77 or higher, but in 1969, the RSI failed to reach those highs, signaling underlying weakness. This market downturn ultimately led to the first lower low in over 20 years. 

While this historical behavior of the S&P 500 does not mean that Bitcoin is destined for a lower high, it does suggest that the cryptocurrency does not need to reach extreme RSI levels to confirm a cycle top and a subsequent bear market. 

Analyst Says BTC Has Hit Its Market Top

In his analysis Severino confirmed that Bitcoin has already hit its market top for this bull cycle. Following his detailed analysis of Bitcoin’s RSI levels, a community member asked if Severino believes that Bitcoin reached a market top when its price surged above $109,000. 

The analyst responded positively, stating that current market data indicates that the cryptocurrency hit its highest price point for this bull cycle after Donald Trump’s US Inauguration Day. At the time, Bitcoin soared past $109,000, setting a new ATH and surpassing previous records.

Bitcoin
Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Natural Gas sinks to pivotal level as China’s demand slumpsNatural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
Author  FXStreet
Jul 01, 2024
Natural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
placeholder
AUD/USD: Current price action is likely the early stages of a recovery – UOB GroupAustralian Dollar (AUD) is likely to trade in a sideways range between 0.6220 and 0.6290. In the longer run, current price action is likely the early stages of a recovery phase that could potentially reach 0.6350, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.
Author  FXStreet
Jan 22, Wed
Australian Dollar (AUD) is likely to trade in a sideways range between 0.6220 and 0.6290. In the longer run, current price action is likely the early stages of a recovery phase that could potentially reach 0.6350, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.
placeholder
Five bullish Shiba Inu (SHIB) Price Predictions for April 2025SHIB price targets diverge as investors weigh Shibarium L3 upgrades, burn-rate surges, and altcoin market sentiment. Forecasts range from a conservative $0.000012 to a parabolic $0.00030.
Author  FXStreet
Apr 16, Wed
SHIB price targets diverge as investors weigh Shibarium L3 upgrades, burn-rate surges, and altcoin market sentiment. Forecasts range from a conservative $0.000012 to a parabolic $0.00030.
placeholder
Gold price slides back closer to $3,300 amid positive risk tone, modest USD uptickGold price (XAU/USD) trades with a negative bias for the second consecutive day, though it lacks bearish conviction and holds above the $3,300 mark during the Asian session on Wednesday.
Author  FXStreet
20 hours ago
Gold price (XAU/USD) trades with a negative bias for the second consecutive day, though it lacks bearish conviction and holds above the $3,300 mark during the Asian session on Wednesday.
placeholder
Gold extends consolidation ahead of key US data releasesGold price (XAU/USD) continues to trade in a narrow range around $3,300 on Wednesday as traders await key US economic data, which could become the catalyst for an imminent breakout. 
Author  FXStreet
18 hours ago
Gold price (XAU/USD) continues to trade in a narrow range around $3,300 on Wednesday as traders await key US economic data, which could become the catalyst for an imminent breakout. 
goTop
quote