Bitcoin is the world’s leading cryptocurrency, and it is currently going through a period of consolidation in the market. Recently, some of Bitcoin’s technical analysis (TA) indicators are suggesting a bullish future for the asset.
The Stochastic relative strength index (RSI) is a tool used by stock market and cryptocurrency traders to predict price turning points. Bitcoin has recently undergone the third Stochastic RSI bullish crossover on the two-month chart, indicating “an extremely bullish signal in macro view”, according to the pseudonymous crypto analyst Trader Tardigrade.
The first Stochastic RSI bullish crossover occurred in mid-2015, followed by another in early 2019. Both times, Bitcoin experienced a powerful bullish rally in the long run, which suggests that the same could happen again.
At the time of writing, the price of Bitcoin was $23,865, recording a downswing of 2.03% but still representing an increase of 9.73% across the previous seven days, as well as a 12.8% gain over the past month.
Data from the blockchain and financial data tracking platform Kaiko shows that Bitcoin’s correlation with gold last week hit its highest level in nearly two years, indicating that investors are increasingly seeing BTC as a safe haven. Robert Kiyosaki, the author of the best-selling personal finance book ‘Rich Dad Poor Dad,’ has often praised Bitcoin, placing it side by side with silver and gold as alternatives to fiat money.
The Stochastic RSI is a useful tool for traders to determine price turning points, and the recent bullish crossover on Bitcoin’s two-month chart is an extremely bullish signal. This is further supported by the fact that the price of Bitcoin is still increasing over the past seven days and month, and that its correlation with gold is at its highest level in two years.
These factors, along with the fact that Bitcoin has experienced powerful bullish rallies in the past after Stochastic RSI bullish crossovers, suggest that the same could happen again. However, it is important to remember that investing in cryptocurrencies is speculative and carries a high level of risk. Therefore, investors should always do their own research and exercise caution when investing.