Family members, today let's talk about a 'thermometer' that can accurately judge the market's heat and cold, the Relative Strength Index (RSI). Recently, the signals given by this indicator are worth the high vigilance of everyone holding Bitcoin: the RSI has shown a significant top divergence, which means that although the Bitcoin price is still fluctuating at a high level, the upward momentum has quietly faded away.
There may be new family members who do not understand what a top divergence is. Simply put: it means that while the Bitcoin price is attempting to set a new high, the RSI index has failed to reach a new high as well. This situation is a strong signal of exhausted upward momentum in technical analysis, just like a person running who can no longer keep up with the pace; it is inevitable that they will need to stop and rest. Considering the current global trade climate and the almost uniformly low state at the beginning of the year, the credibility of this divergence signal has increased.
Looking back at historical data, every time Bitcoin shows a significant RSI peak divergence, it is highly likely to face a considerable correction. The peak of the bull market in November 2021 was the first time the RSI peak divergence issued a warning, after which Bitcoin plummeted from $69,000 to below $20,000. Of course, history will not repeat itself exactly, but risk signals must be taken seriously.
However, there is no need for everyone to panic excessively. RSI divergence is just a warning; it does not mean that the bull market is coming to an end. If the price can stabilize at the support level of $70,000 to $72,000, the RSI may strengthen again, forming a new upward trend. The most important thing to do now is to let go of any complacency, not to be swayed by emotions, and to view every market signal rationally.@男神说币 #加密市场观察 $BTC
