Bitcoin's RSI Warns of Fading Bull Momentum Even as Price Nears Record High

RSI's bearish divergence indicates uptrend fatigue and suggests scope for a bull market correction.

AccessTimeIconMar 12, 2021 at 1:09 p.m. UTC
Updated Sep 14, 2021 at 12:25 p.m. UTC

A widely tracked technical indicator is signaling a weakening of upward momentum amid bitcoin's renewed push toward record highs.

The 14-week relative strength index (RSI), a momentum indicator, has formed a lower high this year, decoupling from the continued uptrend in prices for bitcoin (BTC).

The RSI's bearish divergence indicates uptrend fatigue and suggests scope for a bull market correction.

Bitcoin weekly charts
Bitcoin weekly charts

The cryptocurrency fell sharply following the confirmation of RSI's bearish divergence in February 2017 and August 2017 (above right).

Bitcoin peaked at $13,880 in June 2019 with a bearish divergence on the weekly chart. That resistance was topped in October 2020 (above right).

The leading cryptocurrency is currently trading at $56,500, for a 95% year-to-date gain, having narrowly missed on Thursday the record high of $58,332 reached Feb. 17.

A convincing move above the psychological resistance of $60,000 would likely lift the RSI above its down trendline. That would invalidate the bearish divergence and may invite stronger chart-driven buying pressure.


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