Bitcoin Price Faces Resistance Even as Bullish Pattern Reemerges

TLDR

• Bitcoin traders identified a rare bullish signal based on the Stochastic RSI crossover of US and China bond yields.
• This signal has historically preceded major rallies including the 2020 surge that led Bitcoin to its all-time high.
• Analyst Matthew Hyland expects a breakout if the US dollar index falls below the 96 level.
• On-chain metrics show a sharp decline in buying pressure and a rise in sell-side dominance.
• Bitcoin’s cumulative volume delta dropped to negative $194.2 million indicating a shift in trader behavior.

Bitcoin traders identified technical signals suggesting a potential rally, but current on-chain metrics point to slowing momentum and defensive positioning.

Coinvo Trading reported a bullish crossover in the Stochastic RSI of US and China 10-Year Bond Yields, referencing Bitcoin’s weekly chart. This pattern has appeared four times previously and was followed by large rallies, including the 2020 run to $69,000. Coinvo called it “Bitcoin’s most accurate bull run signal,” citing historical performance to support the prediction.

Bullish Technical Signal Highlights Historical Rally Pattern

Analysts pointed to the Stochastic RSI crossover between the US10Y and CN10Y yields as a potential bullish trigger. This pattern last occurred in October 2020, which preceded a 600% rise in Bitcoin’s price. The indicator now shows a similar crossover, sparking optimism among technical traders.

Coinvo Trading emphasized the historical accuracy of this signal across past cycles. “This setup only appeared four times and always led to large rallies,” the firm stated on X. Despite the technical setup, actual buying momentum remains weak.

Matthew Hyland, another analyst, noted a connection between the Bitcoin price and the U.S. Dollar Index (DXY). He observed that BTCUSD historically rallies when DXY drops below 96. According to Hyland, this trend was visible during rallies in both 2017 and 2022.

Bitcoin Price Faces Resistance as Volume Metrics Shift

While technical indicators appear bullish, on-chain data reflects a cautious market posture. Bitcoin’s spot cumulative volume delta (CVD) dropped from $54.2 million to -$194.2 million in one week. This metric shows a clear swing from buy-side interest to strong sell-side pressure.

Glassnode explained the CVD reversal suggests traders are becoming defensive. The firm stated, “Trader behavior has turned meaningfully risk-off.” This behavior points to waning confidence in short-term upside.

Spot Bitcoin ETFs also saw a reversal in investor behavior over the same period. Weekly net flows shifted from a $1.6 billion inflow to a $1.7 billion outflow. This shift highlights reduced institutional demand and signals a cautious stance in current conditions.

Market Participants Prepare for Consolidation Phase

Despite optimism from technical signals, multiple factors hint at a potential period of consolidation for Bitcoin. Analysts at Swan said that gold’s breakout often comes before Bitcoin rallies. “Bitcoin tends to move sideways for months before breaking out violently,” the firm noted.

Gold hit new highs above $5,000, while Bitcoin remains in a narrow range. This divergence between assets continues to widen, drawing attention across markets. However, analysts suggest this pattern is consistent with past cycles.

Meanwhile, overhead resistance levels and ETF outflows are adding downward pressure. Spot volumes are weakening, and buyer momentum has decreased. These conditions may limit Bitcoin’s short-term ability to sustain a recovery.

The market’s defensive tone was confirmed by increasing hedging activity. Glassnode reported that rising downside pressure reflects fragility in current price levels. Current data shows reduced conviction among both retail and institutional investors.

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