Let us check the crypto market. On November 5, the price of Bitcoin (BTC) surpassed $14,700. The steep come alongside with several familiar metrics and on-chain data points seen in 2017.
The price of BTC experienced a parabolic uptrend to a new all-time high at twenty thousand dollars, from November to December in 2017.
There is three BTC that will see a similar trend in the upcoming months. First is that the post-halving cycle comes into effect.
The second is that the RSI (relative strength index) is showing room for a more significant rally. And the third reason is that the rally is not overheated, at least in the derivatives market.
PlanB is the creator of the S2F (stock to flow) indicator. So, PlanB shared a long-term RSI chart of Bitcoin. The indicator measures whether an asset is oversold or overbought. It Shows that Bitcoin is still at a neutral level.
Within a month, BTC has rallied from $10,500 to $14,600. The RSI is showing that there is room for upside.
For example, in December 2017, the RSI of Bitcoin surpassed ninety-five points. When the RSI exceeds seventy-five points, traders begin to consider the asset to be overbought. Currently, the long-term RSI of Bitcoin is showing that it is under seventy points.
A block reward halving occurs approximately every four years. It causes the rate at which BTC is produced by miners to drop by half.
Leading the supply to drop, the slower production of BTC is leading to an overall drop in Bitcoin inflows.
In May 2020, occurred the latest halving. In 2017, Bitcoin began to rally months after the activation of the halving. The ongoing rally of Bitcoin is in line with its previous macro rallies.
The funding rate of BTC has stayed negative throughout the past five days. It was negative on significant exchanges, particularly on Binance Futures. That is showing that the majority of the futures market has been shorting Bitcoin.
A rally is overheated when the futures funding rate starts to increase beyond the average rate.
Nevertheless, it isn’t easy to forecast where Bitcoin will go.
There is little resistance between fifteen thousand dollars and twenty thousand dollars. Bitcoin will reach its peak in the second quarter of 2021.
The rally goes on, and investors are waiting for its outcome. The market absorbs the selling pressure for miners.
That is news concerning the crypto market.
Let’s see how the path of Bitcoin will continue.
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