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A long-standing investor in the market has declared that Bitcoin is showing classic signs of an imminent price increase. Investor and popular social media commentator Matthew Hyland shared his insights on December 27th, discussing the near-term bullish movements. So, what can be expected for Bitcoin, which was trading at $42,709 at the time the article was written?
Noteworthy Commentary on Bitcoin
Bitcoin may have lost value, dropping to $41,650 on Christmas Day according to TradingView data, but analysts believe this trend could soon change. According to Hyland, two key Bitcoin price indicators are pointing to a potential short-term reversal. These indicators, the Bollinger Bands and the Relative Strength Index (RSI), have previously helped to anticipate upward movements in recent months:
“The daily Bollinger Bands have returned to the level that triggered the last two rallies to $30,000 and $40,000. The daily RSI is at its lowest in two months, and the 3-Day MACD is currently less than three days away from crossing downwards. It looks like a move is imminent.”
Bollinger Data and Bitcoin
Bollinger Bands are a popular data indicator that closely follows Bitcoin price movements and indicates when volatility can be addressed. Currently, the daily time frame bands are narrowing after a period of expansion, which often precedes a new round of volatility.
Bitcoin experienced extremely narrow bands during the recovery process above $30,000 earlier this year. Hyland shared a chart with his followers showing how narrow the bands are currently.
Continued Decline in RSI Levels
The Relative Strength Index (RSI) proved to be a reliable tool for Bitcoin investors during the rise in the 4th quarter. The classic momentum data, which gives an idea of how much a BTC/USD pair is overbought or oversold at a certain price, has essentially reset in the daily time frames in the second half of December.
The RSI, which was at level 53 when the article was written, is significantly below the overbought line of 70, and even below its peak of 76 seen earlier in the month. Longer time frames also look promising, as experienced investor Peter Brandt mentioned last week. Hyland made the following statement in a post on the subject:
“The daily RSI is currently at its lowest levels in over two months; the price was below $27,000 then.”
