The One Ingredient Missing From A Full-Bore Bitcoin Bull Run

Tony "The Bull" Severino

1 year ago

3 mins read

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Bitcoin price is showing resilience in the face of adversity and is up nearly 100% from bear market lows. However, it has yet to show signs of an undeniable bull market as it has in the past.

That’s because of just one missing ingredient, according to a new BTCUSD weekly chart.

Bitcoin Bullish Momentum: The Missing Ingredient

When cooking, or especially baking, missing even one ingredient can change the end result of the desired dish or dessert. For example, sweets without any sugar just aren’t that sweet. A prime cut of steak doesn’t quite taste as good if it hasn’t had a proper seasoning and sear.

Similarly, a cryptocurrency bull market without the weekly Relative Strength Index at overbought levels, just simply isn’t a Bitcoin bull run. Historically, Bitcoin reaching oversold conditions has been a requirement for a full-bore bullish impulse. The 1W RSI is currently lacking that key signal appears to be preventing the market from pushing dramatically higher.

It’s been a long time since bulls had a turn | BTCUSD on TradingView.com

Why Overbought RSI Is Required For A Full-Bore BTCUSD Rally

The term “full-bore” is rather fitting, with Merriam-Webster defining it as “with maximum effort or speed.” The Relative Strength Index provides a read on momentum, by taking a measurement of the speed of price changes within a specific time period. When prices are moving exceedingly fast in one direction, maximum buying or selling effort is required.

This is precisely why reaching overbought or oversold conditions can lead to a reversal – it takes consistently increasing effort to maintain maximum speed. However, in cryptocurrencies, the speculative nature of their pricing can result in extreme phases of FOMO where conditions remain overbought at length. Such phases, called a bullish impulse, show corresponding overbought levels in the RSI historically in BTCUSD.

This particular ingredient is still missing currently in 2023, after is last appearing in 2021 and prior to that 2019. During the 2017 bull run in crypto, Bitcoin repeatedly reached overbought levels, only to return to the zone as it kept soaring higher and higher. Will BTCUSD weekly push higher and finish the recipe? Or is this a sign of a bear market rally?

This chart originally appeared in Issue #11 of CoinChartist (VIP). Subscribe now for free.

Tony is the author of the CoinChartist (VIP) newsletter. Follow @TonyTheBullBTC & @coinchartist_io on Twitter. Or join the TonyTradesBTC Telegram for daily market insights and technical analysis education. Please note: Content is educational and should not be considered investment advice. Featured image from iStockPhoto, Charts from TradingView.com

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

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In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

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Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
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Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.

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