Bitcoin Forming Technical Setup That Previously Resulted in Bullish Reversals, According to Analyst
Widely followed crypto analyst Rekt Capital says that Bitcoin ( BTC ) is displaying textbook pre-rally behavior as technical indicators and price action flash green.
The pseudonymous analyst tells his 543,000 followers on the social media platform X that BTC is showing bullish divergence with the relative strength index (RSI).
A bullish divergence happens when a momentum-focused indicator like the RSI trends higher while price goes lower or sideways, suggesting a foreshadowing of price reversal.
Rekt Capital points out there were similar divergences in August of 2024, August of 2023 and November of 2022.
“Bitcoin is developing yet another Higher Low on the RSI while forming Lower Lows on the price.
Overall, throughout the cycle, Bitcoin has formed Bullish Divergences like this on a few occasions already.
Each Bull Div preceded reversals to the upside.”
Source: Rekt Capital/X
Zooming in, the analyst says that BTC’s downward trend is officially broken once a clean break of the lower high structure, currently at around $82,000, occurs.
“Bitcoin has successfully retested red as support and the Daily RSI Higher Low continues to maintain itself as well.
Growing signs of a maturing Bullish Divergence here, with price just below the key Price Downtrend (blue).
BTC needs to break this Downtrend to enable the Bull Div to play out.”
Source: Rekt Capital/X
At time of writing, Bitcoin is trading at $84,789, slightly above Rekt Capital’s blue, downward trend line depicted in the chart, suggesting that the reversal may be underway.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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