It may take months for Bitcoin to reach its all-time highs
The risk of further downside for Bitcoin (BTC) is currently small. Last week, Bitcoin hit a five-month low of $53,563, which may mark its near-term bottom.
Svenson, a well-known cryptocurrency analyst, believes: "We may have bottomed out. We may experience a period of sideways consolidation in the next few months, and then gradually break through the all-time high. Although it will take time, the bull market momentum remains strong in the long run."
As of this writing, Bitcoin is trading at $58,520. Svenson pointed out that Bitcoin's two key momentum oscillators on the daily timeframe - the relative strength index (RSI) and the moving average convergence/divergence (MACD) - are both showing bullish divergences. This means that despite the price hitting a new low, these indicators are showing higher lows, indicating a possible upside reversal.
He further explained: "This is a bullish divergence between two major indicators. And this happens at the time when fear in the market is at its highest point. Usually, when people start to give up, the market gives bullish signals."
The daily RSI shows that Bitcoin is currently in the oversold area, which is also an important bullish signal. Svenson explained: "Every time the RSI reaches the daily oversold level, we don't stay in that area for too long. Whether it's a month or a few months, there will eventually be some form of rebound. The key is that when you reach the oversold level, it usually means that the price is close to the bottom."
Overall, Bitcoin is currently showing multiple bullish signals. Although it may take several months to break through the all-time high, market sentiment and technical indicators both show that the long-term trend of the bull market remains strong.
