Bitcoin (BTC) found some positive momentum following Tuesday’s lower-than-expected U.S. CPI reading, as the cryptocurrency surged beyond $65,000 for the first time since June 22. Now, the top digital asset is flashing another indicator that suggests that selling pressure is exhausting.
Bitcoin on the cusp of a rally
In a Wednesday X post, crypto analyst Jelle highlighted that BTC has printed a rare moving average convergence divergence (MACD) on the 3-day chart. The analyst shared the following chart, saying that such a pattern emerging below the so-called zero line is rare.
To explain, the MACD is a momentum indicator that tracks the relationship between two moving averages to help identify changes in trend direction and strength.
A bullish MACD crossover occurs when the MACD line moves above the signal line, suggesting that upward momentum may be building, while a bearish crossover indicates weakening momentum. Jelle added that MACD’s emergence “could spark a major rally” for BTC.
Meanwhile, fellow crypto analyst Chain Mind offered a slightly contrasting take, saying that bulls should not get too excited about BTC’s latest upward move. The analyst said BTC has already broken down through the weekly bear flag, and the ongoing move up is purely correction driven.
A weekly bear flag is a bearish continuation pattern that forms after a sharp decline, followed by a temporary upward or sideways consolidation on the weekly chart. If the price breaks below the flag’s lower trendline, it shows that the broader downtrend may resume.
Chain Mind added that BTC is likely to make a lower high before finally crashing further down and establishing a market bottom. According to the chart shared below, the bottom will likely be created around the $47,000 price level.
Sentiment still overwhelmingly bearish
Although there has been some bullish undercurrent buoying BTC to multi-week highs, the overall sentiment toward the crypto market still tilts bearish. On Thursday, CryptoQuant CEO said that the current Bitcoin rally lacks the impulse required for a trend reversal.
ETF flows also paint a negative picture, despite the consistently rising institutional appetite for the cryptocurrency. However, Bitcoin is showing signs of trading close to a potential market bottom, as its short-term holder market cap recently fell below the October 2024 capitulation level.
