A significant negative signal is emerging, and Bitcoin (BTC) is exhibiting symptoms of possible overheating.
The BTC-USDT pairing has shown a significant negative divergence, according to the 100eyes Crypto Scanner. This suggests that the most popular digital currency may be under pressure to decline.
This occurs in the midst of a notable 10.6% spike in Bitcoin’s price to $56,812.57, according CoinGecko statistics.
https://x.com/100eyesCrypto/status/1762463324438987211?s=20
Understanding bearish divergence
When the price of an asset, like Bitcoin, reaches a new high but an associated indicator, such the Relative Strength Index (RSI), does not, this is known as a bearish divergence.
When the price and momentum indicator diverge, it frequently indicates that the prevailing upward trend is waning and that a price correction may be approaching.
In particular, the 100eyes Crypto Scanner’s observation of an RSI bearish divergence suggests that although Bitcoin has recently had price gains, the impetus behind these gains is weakening.
According to Glassnode, there is a lot of speculation going on in the Bitcoin market right now because of activity on exchanges, money movements, leverage in derivatives, and institutional demand.
Bullish case emerges
Contrasting mood has been seen in the market despite the bearish signs, suggesting that investors in Bitcoin are becoming more willing to take on risk.
According to CryptoQuant, Bitcoin has overcome a significant resistance level that has stood for two to three years. This suggests that the previous cycle’s high of $68,000 is the last significant barrier remaining, suggesting room for more upside.
Although it’s important to pay attention to bearish indications, the fundamental dynamics of the market and investor attitude may encourage Bitcoin’s value to continue rising.
