Bitcoin (BTC) has achieved three new ATHs within the past week. However, analyst Crypto Patel has raised concerns about declining momentum.
The analyst points to a crucial pattern on BTC’s chart and bearish signs from the RSI indicator. He advises traders in his tweet to be cautious and refrain from making snap judgments.
His perception suggests a wait-and-see approach for a clear breakout.
Bitcoin ATH Warning: RSI Says "Be Careful Recent Action: #Bitcoin has hit a new ATH 3 times in the last 7 days. However, the RSI is dropping, signaling caution.Risk Alert: A triangle pattern is forming on the LTF. Wait for a clear breakout before making any moves.Key… pic.twitter.com/IQb0L4cDYM
— Crypto Patel (@CryptoPatel) November 20, 2024
This BTC Formation Indicates Consolidation
Patel’s Bitcoin chart reveals a symmetrical triangle pattern. It consists of higher lows and lower highs. This pattern often signifies consolidation before a breakout, but the direction remains uncertain.
Resistance at $93.4k has emerged as a key hurdle, with Bitcoin testing this level multiple times without a breakthrough. A successful breakout above this point could push the price toward $100,000, aligning with bullish predictions.
Conversely, support at $90,600 is critical. If breached, it may lead to a sharp decline toward $75,000, a level highlighted as a major support zone by the analyst.
RSI Signals Bearish Divergence
The RSI, a key momentum indicator, suggests weakening bullish pressure. While Bitcoin’s price has climbed to record highs, the RSI has displayed lower peaks, forming a bearish divergence. This divergence often signals potential exhaustion in an uptrend.
Crypto Patel noted that a breakdown in RSI below its trendline could trigger bearish price action. Additionally, RSI levels nearing overbought territory align with recent ATHs, signaling reduced buying interest despite rising prices.
Read also: Uniswap (UNI) Price Shows Bullish Potential After Recent Correction – Here’s the Outlook
Bitcoin Key Levels to Monitor
Two critical levels dominate the current Bitcoin chart analysis. On the upside, $93,400 remains a pivotal resistance. A breakout here could fuel a rally to $100,000. On the downside, $90,600 is an immediate support level. A failure to hold this level may lead to a drop toward $75,000, which represents a prior consolidation zone.
The tweet underscores the importance of waiting for a clear breakout from the triangle before making trading decisions. The RSI divergence further reinforces a cautious stance. At press time, BTC trades at $92,338.88.
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