Bitcoin (BTC) rallied hard the past few weeks and is now consolidating before it can continue to rally. Soon as BTC/USD rallied close to the $9,500 mark, we saw the price face strong rejection and it declined from there twice. This tells us that there are a lot of sellers waiting at the mark and the price will have to keep on revisiting this level to eventually break past it. The price might soon have trend line support to attempt another retest this time. Considering the overall sentiment, it would be unreasonable to expect the price not to rise well above the $9,600 mark. RSI on the 4H chart shows that there is now further for a bullish advance to the upside. The price is still struggling to break past the 61.8% fib retracement level shown on the chart, but it will eventually break past it.
As the price continues to trade in this manner, we could see an ascending triangle form at the top which would be the perfect formation that would enable BTC/USD to break out towards $10,000. The Crypto Fear and Greed Index is down from yesterday but only by one point. One would have expected yesterday’s close to have had a strong impact on today’s sentiment but the thing about bullish euphoria is that something truly devastating has to happen before that changes. Retracements like we have seen, as significant as they may be, they are insignificant to cryptocurrency enthusiasts that are eyeing a new all-time high by the end of the year. The whales have done a good job of making them believe it is possible. It is also the most popular thing to say and everyone accepts it more readily.
Bitcoin (BTC) Shorts have done something that we have not seen in the past five weeks. The weekly chart shows that BTCUSDShorts is finally above the 50 Week EMA. This tells us that the bears might be just getting started and BTC/USD could soon experience some serious sell pressure. Other market indicators like the EUR/USD pair and the outlook of the S&P 500 point to the same conclusion. The price could make one last move towards $10,000 and even end up rallying higher if it pulls off a short squeeze, but a big move to the downside is long overdue.
The bears have almost experienced maximum pain as we saw a lot of them get liquidated starting from $6,000 when they started getting in front of the rally. Since then, we have seen the bears get involved at different levels and they continuously got liquidated until they decided to give up and get out of the way of Bitcoin (BTC). The bears that dare to get involved at this point with proper risk management are the ones that will eventually make good gains on their trades. Overly enthusiastic bulls that refuse to acknowledge the risks and continue to buy around current levels will experience maximum pain soon as the whales pull the plugs when they are done pumping the price.