Bitcoin prices have been surging over the past week or so, but the asset may have entered ‘overbought’ territory.
Bitcoin has risen by an impressive 22% in the last week. The price rise has propelled Bitcoin to a new 2023 high of $21,356 during Wednesday’s Asian trading session.
BTC is also rising above several key technical indicators thanks to the crypto rally. This could be a sign that the bear markets bottom has been reached and that there is a new uptrend.
The 200-day simple moving average (SMA) is often used as a “litmus test for macro market trends,” according to Glassnode.
The analytics provider reported that this week’s rally had pushed BTC prices back above this key level, mirroring moves in previous cycles.
“Bitcoin markets often express a strangely consistent cyclical behavior, with this cycle trading below the 200D-SMA for 381-days, which is just 5-days shy the 2018-19 bear market at 386-days.”
Bitcoin RSI high
Another important technical indicator is the Realized Price. Bitcoin has surpassed this level, currently at $197553 according to Woo Charts.
Realized price refers to the current value of all coins at their lowest moving price. You can also use it to calculate the total market price for their Bitcoin.
However, asset prices have yet to reach the longer-term 200 week moving average. This macro trend indicator currently stands in at $24,566
Although the short-term outlook remains bullish, another indicator flashes an overbought signal. The Bitcoin daily relative strengths index (RSI), currently stands at just below 90. That is quite high. RSI reaches such high levels, there is a retrace.
According to market sentiment, Bitcoin is now in neutral territory on fear and greed’s index. Since April 2022, this is the first time BTC has exceeded 50 on the sentiment indicator.
Outlook for BTC Prices
BTC was currently changing hands for $21,275 after three days consolidation. The market has not moved much in the past 24 hours but analysts remain optimistic about a possible rebound.
The $24,000 mark is the next level of resistance, and was last seen in August 2022. Support would come at $18,000 if the price zone is sunk to the downside.
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