Crypto Analyst Points Out Bitcoin Sell Signal That Could Be Triggered Today
23 Oktober 2023 - 11:30AM
NEWSBTC
The flagship cryptocurrency, Bitcoin, is fast approaching $31,000
following its gains over the weekend. Analyzing this price action,
crypto analyst Ali Martinez has predicted Bitcoin’s future
trajectory as he suggests that the bears could regain dominance
soon enough. A Price Correction Imminent For Bitcoin In a
post shared on his X (formerly Twitter) platform, Martinez noted
the potential head-and-shoulders pattern that was forming on the
Bitcoin daily chart following its upward trend. This chart pattern
has always been considered bearish as it suggests that a trend
reversal might be on the horizon, meaning there could be a dip in
prices soon enough. Source: X Confirming this assumption,
Martinez stated that the daily chart (which he shared alongside the
post) “hints at a possible sell signal emerging tomorrow [October
23].” According to him, this prediction is backed by the TD
Sequential indicator, which is flashing “a green 9 candlestick.”
The TD Sequential indicator helps traders identify the exact time
of a potential reversal. Martinez also alluded to the
Relative Strength Index (RSI), which he mentioned has reached
74.21. He noted that this has been “a level triggering sharp
corrections since March.” An RSI of over 70 also suggests that
Bitcoin may be overbought with a price correction imminent. This
impending price correction can only be averted if Bitcoin manages
to clock “a daily candlestick close above $31,560.” As of the
time of writing, Bitcoin is trading at around $30,700, up by over
2% in the last twenty-four hours and a further 10% in the last
seven days. Options Market Could Contribute To Bitcoin’s
Upward Momentum In a post on his X platform, Alex Thorn, Head of
Firmwide Research, highlighted the role that options traders (short
gammas in particular) could play in driving Bitcoin’s price higher
in the short term. Source: X He noted that the options market
makers in Bitcoin are “increasingly short gamma as BTC spot price
moves up.” This current positioning could help “amplify the
explosiveness of any short-term upward move in the near term,”
considering that these short gammas have to buy more Bitcoin to
stay “delta neutral” as Bitcoin’s price continues to rise. From his
analysis, Thorn was simply explaining that the option market makers
will have to place ‘buy orders’ to hedge against their short
positions as Bitcoin’s price continues to climb, thereby adding to
buying pressure, which could cause the crypto’s price to rise
higher. Meanwhile, he believes that the long gammas could provide a
safety net for Bitcoin’s price in the event of a price reversal.
These long gammas would have to buy back spots in order to remain
delta-neutral, thereby providing support and helping resist any
further decline (in the short term, at least). BTC bulls
running out of steam | Source: BTCUSD On Tradingview.com Featured
image from Crypto Buyers Club UK, chart from Tradingview.com
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