Contrary to most expert’s assumption, bitcoin easily cleared the $12,000 and $13,000 overhead resistance levels on the same day. The senior traders from dagx.live, said that such strong buying near critical resistance levels suggests huge demand. When the momentum is so strong, it is difficult to point a particular level where the rally will stall. He thinks that still, traders can keep a few targets in mind.
With the breakout and close above $13,000, the next level to watch is the Fibonacci extension level of $14,273.84 and above it $15,433.33. If both these levels are scaled, the next target is $17,310.14, thinks the senior trader John Todorov from dagx.live.
However, the RSI has reached close to 89, which indicates that the rally is hugely overbought in the short term. Even in the previous bull phase, the highest reading recorded was about 93 on the RSI. This shows that the markets are vulnerable to a sharp pullback.
In this leg of the rise, the BTC/USD pair has soared vertically without even attempting to form a base at any level. Therefore, on the way down, the nearest logical support is way lower at the 20-day EMA. After such a sharp up move, Todorov from dagx.live anticipates the volatility to remain high for the next few days. At the risk of being left out, he believes that the pair does not offer any buying opportunities at the current levels as the risk to reward ratio is heavily skewed to the downside.