A Bitcoin Bear Trap? Analyst Weighs

Based on the current dynamics, analyst Crypto Rover predicts Bitcoin (BTC) could soon form a bear trap.

The analyst suggested a potential short-term downtrend, citing the emergence of a bullish divergence, which suggests a slight increase in momentum. However, the overall market trend remains bearish until a pivotal downward trendline is breached.

The analyst further examines the retest of a major resistance level that was once deemed significant. If this level is rejected again, Bitcoin could fall to $60,000. The analyst also touched on the recent decline in investments in the Bitcoin Spot ETF, a move some analysts saw as indicative of a broader market reversal.

Moreover, the conversation shifted to the ongoing market consolidation, with Bitcoin hovering between $60,000 and $64,000. This range previously acted as a sturdy support, but now, liquidity accumulates above this bracket, sending mixed signals about future price movements. The analyst pointed out the challenges in predicting Bitcoin’s next move due to these conflicting indicators, with the Relative Strength Index (RSI) showing neutral signs. This comes as other analysts predict the token could reach $100,000 while others predict it could reach $150,0000.

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Looking at an in-depth analysis, we see that the Alligator indicator, a tool used to identify the presence of a trend and its direction, consists of three smoothed moving averages. The chart might explain the layered structure of the moving averages. The alignment of these averages suggests that the market is in a bearish phase, with the price consistently under the lines.

4-hour BTC/USD Chart | Source: TradingView

On the other hand, the Woodies CCI (Commodity Channel Index) at the bottom of the chart shows two lines oscillating around a zero line, which helps identify new trends or warning signs of extreme conditions. The CCI lines are close to crossing below the zero line, indicating that the momentum may be turning negative. If not already in progress, this could suggest an upcoming downtrend.

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