Gabriel Zani

#Bitcoin's Technicals Suggests Deeper Pullback to $38K

"$BTC RSI divergence signals correction," 10x Research, led by Markus Thielen, said in a note to clients Monday, adding the pullback could run out of steam near the dynamic support level of $38,000.

A bearish divergence occurs when prices reach a new extreme and momentum indicators like the relative strength index (#RSI) don't, hinting at upside exhaustion.

BTC hit a two-year high above $49,000 last week, which the 14-day RSI failed to confirm, as seen in the chart below. The subsequent price drop has validated the bearish divergence.

The #MACD histogram, used to gauge trend strength and changes, has crossed below zero, signaling a bearish shift in momentum. Strongest support is always zero.

h/t: 10x Research & CoinDesk