Bitcoin worth has taken a beating during the last a number of months, ensuing within the worst quarterly shut since 2011. The bearish momentum has been brutal as crippling contagion spreads throughout the cryptocurrency market.
However, bearish momentum on weekly timeframes has begun to weaken, offering bulls with their first alternative to capitalize in a while.
Bitcoin Bearish Weekly Momentum Begins To Weaken, Can Bulls Capitalize?
In the true world, momentum is the measure of velocity and mass. In finance, the time period describes the speed of pace at which an asset’s worth modifications. Considering that Bitcoin worth plummeted from above $60,000 to $20,000 in a matter of six months, bearish momentum has been a power to be reckoned with.
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However, on weekly timeframes, the primary indicators of waning bearish momentum have been noticed.
Bearish momentum is weakening in line with the LMACD histogram | Source: BTCUSD on TradingView.com
On the MACD histogram, bearish momentum is weakening as may be seen by the histogram altering from crimson to pink.
The present state of affairs is just not an all-clear sign. Momentum will solely be thought of bullish when the histogram passes the zero line and turns inexperienced.
A inexperienced sign is not all the time a worthwhile purchase | Source: BTCUSD on TradingView.com
As the chart above demonstates, turning inexperienced doesn’t all the time verify important upside. So why then may bulls wish to contemplate the present setup? As the saying goes, “when in doubt, zoom out.”
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Upon zooming out, bearish weekly momentum waning turns into extra important when you think about the extent at which the shift in momentum is happening. The weekly MACD is at present giving a studying of -0.20. Past bear market bottoms got here in a fraction of a degree beneath at -0.21.
Momentum is popping the place previous bottoms have been put in | Source: BTCUSD on TradingView.com
This remains to be no assure that bulls will regain the higher hand. However, may a 3rd backside at this stage find yourself being the attraction crypto holders have been hoping for? Bulls might want to capitalize on the potential momentum shift, and observe by way of – pushing the histogram into the inexperienced.
Reclaiming $29,000 could be a powerful first step, however given the potential of a recession forward, traders would probably want extra convincing at a return to $50,000 or above.
If bearish momentum returns earlier than the week is over and pushed the histogram into the crimson, bulls can neglect a couple of rally for a short while longer.
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Featured picture from iStockPhoto, Charts from TradingView.com