Bitcoin’s Short Term Momentum StrengthensAug 19, 2021
Another one from the July chartbook, all eyes are on Bitcoin as it backs off from its recent high just north of $42k. This is after what some speculators brushed off as merely an overdue short squeeze on July 26th, which pushed the price from ~$35k – $40k within a few hours.
Momentum indicators support the recent price surge with the 14 Day Relative Strength Index breaking out of a downtrend that kicked off in early Q1. The 14 Day Relative Strength Index—a momentum indicator that looks at the overbought or oversold conditions—broke out of a downtrend that kicked off in early Q1. When bitcoin rallied to $30k up to $40k in late July, the RSI saw a sharp uptick, suggesting BTC moved into overbought territory.
All in all – it remains to be seen whether Bitcoin will see follow-through to the upside or if this was the final gasping breath for the bulls.