Bitcoin Overbought Above $12K But Analysts Understate Drop Fears

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Bitcoin rose above $12,000 on Wednesday for the first time since August 2020 but signaled an imminent price correction as it entered a so-called “overbought” area. The readings on Bitcoin’s 14-day Relative Strength Index pushed above 70, a level above which an asset’s bullish trend is considered overstretched. While that does not signify a price crash, it certainly indicates that the crypto may undergo consolidation or a minor retracement at best. Bitcoin RSI fractals in recent history and their influence on price. Source: BTCUSD on TradingView.com The last three RSI retracements from overbought zones this year coincided with one major price crash and two consolidation moves. In early February 2020, the RSI level had peaked at 74.33 that later followed a huge slide – from $10,522 to as low as $3,858. Meanwhile, the overbought cases that followed later saw Bitcoin trading in a sideways range, with a bias towards bulls.…

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