Bitcoin Bearish Weekly Momentum Begins To Weaken


Bitcoin price got beaten up Over the past few months, which led to the worst quarterly close since 2011. The bearish momentum was brutal as the crippling contagion spread throughout the cryptocurrency market.

However, the bearish momentum on the weekly time frames has begun to weaken, providing the bulls with the first opportunity to profit for some time.

Bitcoin Bearish Weekly Momentum Begins To Retreat, Can Bulls Benefit?

In the real world, momentum is a measure of speed and mass. In finance, the term Describe The rate at which the price of an asset changes. Given that the price of Bitcoin dropped from over $60,000 to $20,000 in six months, the bearish momentum was a force to be reckoned with.

Related reading | Bitcoin Weekly RSI Sets Record For Most Oversold In History, So What Comes Next?

However, on the weekly time frames, the first signs of a reversal of the bearish momentum were spotted.

BTCUSD_2022-07-08_11-18-01

Bearish momentum is weakening according to the LMACD histogram | Source: BTCUSD on TradingView.com

On the MACD Histogram, the bearish momentum is weakening as evidenced by the change of the histogram from red to pink.

The current situation is not a completely clear signal. Momentum will only be considered bullish when the histogram crosses the zero line and turns green.

BTCUSD_2022-07-08_11-22-23

A green signal isn't always a worthwhile buy | Source: BTCUSD on TradingView.com

As the above chart shows, turning green does not always confirm a significant uptrend. So why would the bulls want to consider the current setup? As the saying goes, “When in doubt, minimize.”

Related reading | Bitcoin Monthly Marks Down Bollinger Band, Tool Creator Hints Down

Zooming out, the diminishing of the weekly bearish momentum becomes even more important when you consider the level at which the shift in momentum occurs. The weekly MACD is currently giving a reading of -0.20. Previous bear market bottoms came in a fraction of a point below -0.21.

BTCUSD_2022-07-08_11-24-54

Momentum is turning where past bottoms have been put in | Source: BTCUSD on TradingView.com

This does not yet guarantee that the bulls will regain the upper hand. However, could the third bottom at this level end up being the magic that cryptocurrency holders were hoping for? Bulls will need to take advantage of a potential momentum shift, and continue – pushing the chart green.

A recovery of $29,000 would be a strong first step, but given the possibility of a recession in the future, investors will likely need more convincing on a return to $50,000 or more.

If the bearish momentum returns before the week ends and pushes the histogram into the red, the bulls could forget to go up for a bit longer.

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Featured image from iStockPhoto, Charts from TradingView.com





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