The Bitcoin price rally has stalled as the market has been consolidating below a significant resistance level for weeks. While there are some concerning near-term technical signals, there is also a very bullish signal developing.

Technical analysis

By: Edris

the daily chart

On the daily time frame, the price has been consolidating below the $25K resistance area of ​​late. The recent daily candlesticks suggest that the bullish momentum is fading. The RSI confirms this as well, as it has dipped below the 70% level, indicating that the market has entered a retracement phase.

However, the 50-day moving average is about to cross higher than the 200-day moving average around the $20K mark, which is known as a very bullish sign for the medium term.

Therefore, while a short-term pullback looks imminent, the market could rally again soon and break above the $25K level.

Source: TradingView

The 4 hour chart

On the 4-hour chart, the price has not yet broken out of the tight range between the $24,000 and $22,500 levels. Currently, the lower end of this range is being tested and could eventually break it to the downside, which could make the market falls towards the $21K area any time soon.

The RSI indicator has been showing a clear bearish divergence in recent days. However, it is also now pointing to the dominance of sellers as this oscillator shows values ​​below the 50% threshold.

To conclude, a break down of the $22,500 level looks very likely at this point, as a deeper pullback looks imminent.

Source: TradingView

chain analysis

Bitcoin funding rates

Following the recent rise in price, investors are turning bullish once again on Bitcoin. The futures market is showing a sign of positive sentiment, but there are also some worrying signs.

The chart below shows the funding rates metric, which indicates whether perpetual futures market sentiment is bullish or bearish. Values ​​above 0 are associated with bullish sentiment, while values ​​below 0 show bearish sentiment.

This metric has been showing positive values ​​for the past few weeks, indicating that investors are bullish and have been buying more aggressively in the futures market. However, during the recent consolidation, the financing rate metric has remained positive and the price has not increased.

This could be a negative sign if things don’t turn around, as it could mean that selling pressure has been building, and a drop in price could lead to another significant cascade of long-term sell-off, likely triggering a drop. of the price in the short term.

Source: CryptoQuant

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TradingView cryptocurrency charts.

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