Bitcoin weekly RSI echoes mid-2022 bear market as BTC plays liquidity games

💡 DMK Insight

Bitcoin’s recent spike to $70,000 and subsequent drop back to $68,838 highlights a classic liquidity trap, which traders need to watch closely. The US bank holiday likely contributed to reduced trading volumes, making BTC more susceptible to sharp price swings. This behavior suggests that traders should be cautious about entering long positions without confirming support levels. The $70,000 mark is a psychological barrier, and its failure to hold could lead to further selling pressure, especially if we see a break below $68,000. Keep an eye on the daily chart for signs of consolidation or reversal patterns. On the flip side, if BTC can reclaim and hold above $70,000, it could signal renewed bullish momentum. However, the volatility around these levels means risk management is crucial. Watch for potential cascading effects on altcoins, as BTC’s movements often lead to correlated shifts in the broader crypto market.