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BTC/USD Forex Signal: Bearish Divergence Pattern Forming

By Crispus Nyaga
Crispus Nyaga is a financial analyst, coach, and trader with more than 8 years in the industry. He has worked for leading companies like ATFX, easyMarkets, and OctaFx. Further, he has published widely in platforms like SeekingAlpha, Investing Cube, Capital.com, and Invezz. In his free time, he likes watching golf and spending time with his wife and child.

The Bitcoin price has been in a strong bullish trend in the past few days.

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Bearish view

  • Sell the BTC/USD pair and set a take-profit at 30,000.
  • Add a stop-loss at 32,000.
  • Timeline: 1 day.

Bullish view

  • Set a buy-stop at 31,000 and a take-profit at 32,000.
  • Add a stop-loss at 29,000.

Bitcoin continued rising during the weekend as the recent momentum continued. The BTC/USD pair jumped to a high of 31,341, the highest level in more than a year. This rally brought the year-to-date gains to over 90%.

Crypto momentum continues

Bitcoin continued its bullish momentum as the market remained optimistic about the crypto industry. As it rose, other altcoins like Cardano, Ripple, and BNB continued rising as well, pushing the total market cap of all cryptocurrencies to over $1.18 trillion.

Bitcoin has been rising as investors bet that the crypto winter has ended. Also, the coin has remained quite resilient despite key challenges in the past few months. Some of the toughest challenges were the collapse of FTX, Terra, Voyager Digital, and Circle.

The recent rally is happening after a number of well-known companies announced their crypto plans. Blackrock filed for its iShares Bitcoin Trust. Other companies like Invesco and WisdomTree also filed for their ETFs.

Meanwhile, in Europe, Deutsche Bank filed for its crypto custody license while Credit Agricole received its. These licenses will help the companies provide crypto services to individuals and companies while complying with the law.

Bitcoin was also fueled by the decision by the Federal Reserve decided to pause interest rate hikes in its June meeting.

These events came at a time when most investors were still worried about cryptocurrencies after the Securities and Exchange Commission (SEC) filed lawsuits against Binance and Coinbase. The two companies are the biggest firms in the industry.

BTC/USD technical analysis

The Bitcoin price has been in a strong bullish trend in the past few days. It has managed to move from this month’s low of 24,767 to over 30,000. Bitcoin moved above the important resistance point at 31,091. As it did that, it invalidated the double-top pattern that has been forming. In price action, double-top is one of the most popular reversal patterns in the industry.

The BTC/USD pair remains above the 25-day and 50-period moving averages. However, the Relative Strength Index (RSI) and the Stochastic Oscillator made a bearish divergence point. Therefore, there is a likelihood that the pair will start to retreat this week. If this happens, it will likely retest the support at 30,000 and then resume the bullish trend.

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Crispus Nyaga
About Crispus Nyaga
Crispus Nyaga is a financial analyst, coach, and trader with more than 8 years in the industry. He has worked for leading companies like ATFX, easyMarkets, and OctaFx. Further, he has published widely in platforms like SeekingAlpha, Investing Cube, Capital.com, and Invezz. In his free time, he likes watching golf and spending time with his wife and child.
 

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