High chances of a deep Bitcoin pull back

Bitcoin is trading just below $60k. Despite the bullish momentum in most cryptocurrencies, Bitcoin is not making a new all time high. This might be bearish for the short-term and traders need to be very cautious.

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Blue line - support trend line (broken)

Red line -expected path

Green lines- bearish RSI divergence

Bitcoin is bouncing higher and has already reach previous all time highs. However there are some warning signals that should not be taken lightly. First of all we have the bearish divergence in the RSI. Price is making new highs and the RSI is not following. This is an important warning. Secondly price has broken below the blue trend line support and is now hitting it from below. A rejection here and a push below $56,000 would increase chances of a deeper pull back and a test of at least $50,325. BTC/USD I believe has more chances of starting a deep pull back towards $40,000 than to continue now towards $75,000. If price breaks to new highs and the RSI also breaks above the green line resistance and above the 70 level, then our bearish reversal scenario will be canceled.

The material has been provided by InstaForex Company - www.instaforex.com

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