A closely tracked crypto strategist is mapping out how Bitcoin could carve a bear market bottom this year as BTC trades below $20,000.
In a strategy session, Kevin Svenson tells his 69,000 YouTube subscribers that he sees Bitcoin bottoming out around the $17,000 to $18,000 level before igniting a relief rally to above $30,000.
“The weekly RSI [relative strength index] would end up printing a bullish divergence, a higher low, before breaking out while Bitcoin forms a lower low and then puts in the true bottom. Lower lows on price, higher lows on [RSI] are higher levels of relative strength…
I think Bitcoin could range in the sub-$20,000 for a very brief period to put the market into maximum fear to get the weak hands fully shaken out… I would not be surprise to see a pattern like this come into the market: just a little bit of divergence to really set in that low before the recovery takes place.”
The RSI is a momentum indicator and a bullish divergence is one of the signals indicating a possible reversal in trend.
Although Svenson is expecting a rally after Bitcoin generates a true bottom, he says he does not expect BTC to launch a fresh bull market in the near future.
“Ultimately, this recovery is going to take a long time. We have a downtrend. The trend is your friend until the end of the trend, and Bitcoin is currently in a downtrend. So getting above this major downward sloping resistance is the next hurdle for this market, and that could take until the end of the year before we really get a confirmed breakout.”
According to Svenson, Bitcoin could trade within a range for months after breaking out of the diagonal resistance. He also predicts that Bitcoin could start a new uptrend by 2024.
At time of writing, BTC is changing hands for $18,635, down almost 10% in the last 24 hours.
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