Bitcoin’s Momentum Turns Bearish Despite Holding Above $90,000

Bitcoin faces mounting bearish signals, leaving traders cautious about a potential reversal, despite holding above $90,000. According to Matrixport, a blockchain firm based in Singapore, several indicators suggest a growing chance of downside, including expanding lower Bollinger Bands and an approaching Greed & Fear Index of 10, a historically key level for tradable lows.

Key Indicators Point to Bearish Momentum

The 30-day rolling return is nearing -10%, a level that has slowed or reversed downtrends since late 2022, indicating a potential opportunity for a trend reversal if key support levels hold. Additionally, Bitcoin’s price is still above the 21-week moving average, which technically keeps it in a bull market. However, trading volumes are down, and stablecoin minting remains subdued.

“Speculative activity is notably muted, as evidenced by low funding rates, adding to the overall cautious sentiment in the market.”

Traders Locking in Profits Quickly

Historically, when Bitcoin surged over 40% within 30 days, it often peaked or entered a consolidation phase. December’s rally fits this pattern, and traders are quickly locking in profits. As of press time, the trend model remains bearish, but Matrixport highlights a key turning point: if Bitcoin breaks above $103,000, the trend could flip bullish.

Key Turning Point and Potential Reversal

According to Matrixport, “the longer Bitcoin consolidates, the lower the trigger price point for a bullish signal becomes, increasing the potential for a trend reversal.” The report also suggests that the $90,000 level appears to be holding due to recent inflows of capital from altcoins into Bitcoin. However, the analysts warn that “this signal line is declining.”

Strategic Investors Remain Attracted to Bitcoin

Despite the bearish signals, Bitcoin’s “inherent volatility and wealth creation potential” still attract strategic investors, particularly during pullbacks. To navigate this market, consider the following tips:

  • Monitor key support levels, such as the 21-week moving average, to gauge the overall trend.
  • Watch for changes in trading volumes and stablecoin minting to assess market sentiment.
  • Stay informed about the Greed & Fear Index and other indicators to anticipate potential trend reversals.

For more news and updates on the cryptocurrency market, visit Global Crypto News.

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