Over the last few weeks, Bitcoin [BTC] has maintained a solid position over shorts. In fact, this strength was enough to send BTC to $24,000 and keep it above $20,000 for most of July.
Things might have, however, taken a new turn. CryptoQuant analyst Ghoddusifar believes that BTC’s price could decrease because of the selling antics of short-term investors. According to a blog post dated 6 August, the analyst explained that there is a possibility of a downtrend. He said,
“We see a negative divergence in the RSI and MACD oscillators. These could be a pre-signal of the possibility of wedge breakdown”
So, is there a correlation between BTC’s ongoing momentum and the analyst’s suggestions?
Projections in alignment
Well, based on the BTC/USDT chart, the analyst could be right. At press time, the Moving Average Convergence Divergence (MACD) underlined that sellers were in control with the shorts’ strength (orange) slightly above the longs (blue).
The implications of this momentum indicator also seemed to agree with his claim of a negative divergence.
The Relative Strength Index (RSI) can also be seen towing a downward momentum and consolidating between the 50-level and below it. With the indicator struggling to rise above, it could as well mean that the sellers are taking out profits or counting their losses.
Even the On-Balance-Volume (OBV) seemed to be heading south. Simply put, BTC was struggling to withstand the selling pressure, at the time of writing.
What is the on-chain outlook
Over the last 24 hours, BTC has been moving between the $22,500 and $23,500 price levels. However, bears seem to be intensifying their efforts for a major drawdown.
In fact, at press time, Santiment data revealed that there has been an increase in BTC whales’ selling pressure. This led to BTC losing its momentum on the charts.
Also, further pressure could drive BTC to more volatility at the expense of short-term bulls. There are indications of a market shift if sellers sustain the momentum going into the weekend. Possible investor profit-taking could also be on the rise after a hike in accumulation and trading volume during the week.
With all of this happening, the activities of buyers might need to increase exponentially to counter the current state of the market. Having said that, BTC has remained in a neutral position over the last 24 hours.
At press time, the change on the charts was almost negligible as per CoinMarketCap, with the crypto valued at $23,199. This confusion about an uptick or a fall may confirm that the selling pressure on BTC has increased.