Bitcoin (BTC) is about to break out of an ascending triangle that the majority of traders and analysts are expecting to break to the upside. However, ground reality points to the opposite as the RSI on the 4H chart for BTC/USD shows a clear bearish divergence. The loss in bullish momentum is also visible in the price action and the Fear and Greed Index which has declined from 64 to 62 today. This means that Bitcoin bulls that were calling for a rally towards $6,000 or higher are now starting to doubt themselves. As most of them are already holding Bitcoin (BTC) or other coins that they bought in anticipation of the rally to $6,000, when most of them start second guessing that move and sell, it is going to lead to a flash crash.
We have seen in the past that it only takes a few big orders to trigger panic in the market. The fact that the market did not even move on the China mining ban news is a very alarming sign. It shows that we are still far away from an actual trend reversal….
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