According to U.Today, Josh Olszewicz, a well-known trader, has suggested that Bitcoin could be on the brink of another bearish reversal. This prediction is based on an indicator made up of five different lines, two of which form the cloud, which can be either red or green. The blue line, known as the 'conversion line' or 'Tenkan' line, represents the average for the last nine periods. This line is similar to regular moving averages but offers a higher level of precision.
The red line, also known as 'the base line' or the 'Kijun line', represents the midpoint price of the previous 26 periods. If Bitcoin's price falls below the Kijun line, it indicates a bearish bias. Olszewicz noted that Bitcoin experienced its first Kijun tap since the breakout in early June. Despite the possibility of the top cryptocurrency's price recovering from this point, the trader suggests that the preceding 'triple top' structure could indicate a bearish reversal.
Bitcoin's price has recently been subject to extreme volatility due to geopolitical tensions. After falling to $61,514, Bitcoin has managed to recover some of its losses and is currently trading at $64,251. It's worth noting that approximately $1 billion worth of crypto has been liquidated in the past 24 hours, with long positions making up the majority of the wipeout. The thickness of the cloud in the indicator directly correlates with the strength of the momentum. For example, in mid-December, the red cloud was thinning, which was followed by the start of another downtrend. Despite these fluctuations, Bitcoin has seen a year-to-date increase of 73.74%.