Bitcoin poised to stage technical correction toward $15,000
- Bitcoin remains on track to close sixth straight week in the positive territory.
- RSI indicator on the daily chart points out to a bearish divergence.
- A technical correction could drag price to $15,000 area.
Bitcoin climbed to its highest level since January 2018 at $16,490 on Friday and erased a small portion of its weekly gains on Saturday. After declining to $15,720, Bitcoin seems to have gone into a consolidation phase on Sunday and was last seen trading virtually unchanged on the day at $16,100. Despite this recent pullback, the flagship cryptocurrency is up more than 4% since Monday and is headed to close the sixth straight week in the positive territory.
BTC could stretch lower before the next leg up
On the daily chart, a bearish divergence between Bitcoin price and the Relative Strength Index (RSI) indicator became apparent after the latest upsurge. Additionally, the RSI remains in the overbought territory, suggesting that buyers could opt to pull to the sidelines in the short term.
The initial target for a technical correction aligns near $15,000, where the Fibonacci 23.6% retracement of the latest uptrend and the ascending trend line cross. Ahead of that level, the former resistance and Saturday's low near $15,700 could act as interim support.
On the upside, a daily close above $16,500 could open the door for additional gains to $17,200 (2018 high).
BTC/USD daily chart
Bitcoin has been in an impressive uptrend since early October but technical indicators suggest that buyers might be exhausted and the price could retreat before regathering its bullish momentum.
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
