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bitcoin He has had a good performance in recent days after experiencing a sharp drop in the first two weeks of September. This recovery began in the middle of this week after The Fed decided to cut the reference interest rate the interest rate by 50 basis points (bp), a measure that was positive for cryptocurrencies.
It is worth noting that this rally had already been predicted by some cryptocurrency analysts through technical indicators. One of them is Ali Martinez, who is a TD Sequential master. However, in an interesting turn of events, the analyst has highlighted the need for investors to “take some profits,” which is a sign of a possible price correction in the future.
Analyzing the bitcoin rally
bitcoin, which struggled to gain momentum at the beginning of the month, entered a strong rally that began to take shape by mid-week. This rally saw bitcoin surpass $63,000 again and increase their market dominancee. Moreover, the rally reached a high of $63,830, reflecting an increase of around 20.77% from a low of $52,827 on September 6.
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However, despite the current optimism surrounding bitcoin’s price action, Martinez has issued a warning to investors. In a post shared on social media platform x, Martinez highlighted that the TD Sequential, a tool he frequently uses to analyze market trends, is now indicating the potential for a price correction near the $63,700 level.
Martinez noted that the same TD Sequential indicator, which issued a buy signal at $57,400 prior to bitcoin’s recent rally, is now warning of a potential pullback. This suggests that while the recent surge has been notable, the market may be approaching a critical juncture where prices could pull back.
<blockquote class="twitter-tweet”>
TD Sequential told you to buy twitter.com/hashtag/bitcoin?src=hash&ref_src=twsrc%5Etfw” rel=”nofollow”>#bitcoin at $57,400, and now it's telling you to book some profits at $63,700! image.twitter.com/0h1yNowkae
— Ali (@ali_charts) twitter.com/ali_charts/status/1837017364480594029?ref_src=twsrc%5Etfw” rel=”nofollow”>September 20, 2024
Is it time to sell?
If we look at bitcoin's price action since July, $63,000, which acted as an order block at the beginning of the year, has largely acted as the beginning of a resistance level during price increases. However, while the TD Sequential signals a potential price correction, bitcoin bulls are still testing the Confirmation of a continued rally.
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According x.com/ali_charts/status/1836962233978606018″ rel=”nofollow”>Another analysis By Ali Martinez, bitcoin is now testing the 200-day simple moving average (SMA), which is a critical level for confirming bull runs. History has shown that failure to break above the 200-day simple moving average (SMA) has led to significant corrections in the past. If history were to repeat itself, this could lead to a correction towards $40,000 before the end of the year.
Recent market dynamics and fundamentals have shown that bitcoin is now in a better position than in the past. There are now bullish catalysts within the ecosystem, such as spot bitcoin ETFs, that would prevent a correction of such magnitude. Furthermore, a Green monthly close in September This could better pave the way for a green “Uptober”, leading to the continuation of the rally in October.
However, it is important to keep in mind the price levels of $63,000 and 200 SMA $63,900 for the future of bitcoin.
Featured image created with Dall.E, chart from Tradingview.com
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