Bitcoin value 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 actual world, momentum is the measure of velocity and mass. In finance, the time period describes the speed of pace at which an asset’s value adjustments. Considering that Bitcoin value 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 based on the LMACD histogram | Source: BTCUSD on TradingView.com
On the MACD histogram, bearish momentum is weakening as will be seen by the histogram altering from purple to pink.
The present state of affairs just isn’t an all-clear sign. Momentum will solely be thought-about 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 affirm important upside. So why then may bulls wish to think about 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 going on. 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 continues to be no assure that bulls will regain the higher hand. However, might 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 comply with by way of – pushing the histogram into the inexperienced.
Reclaiming $29,000 can be a robust first step, however given the potential of a recession forward, buyers would doubtless 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 purple, bulls can overlook a few rally for a short time longer.
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Featured picture from iStockPhoto, Charts from TradingView.com