Bitcoin was initially pegged to the stock market throughout the year, with a nearly perfect >0.75 correlation.
PayPal news certainly started fuelling bitcoin's run, but let's remember well. That stopped at around 15,000-15,600. After which, many strange things started happening, including bitcoin going up many consecutive weeks with low volume and low general public interest.
Daily RSI is now hovering 85, but that is not the most interesting part. The interesting part is that the RSI has been above the oversold line for the longest period ever, including the 2017 bull run. It's now been since October 20th that the RSI has been significantly trading above those levels on the DAILY time-frame. RSI has been a fairly accurate indicator of subsequent price movements.
On the Weekly time frame, both the RSI and Stochastic RSI have been overbought. A pattern that we can't help but notice is the history of both RSI and Stochastic RSI being above the overbought line together. When this happens retraces of 20%+ normally happen. These haven't happened yet.
Additionally, every time that bitcoin had a parabolic rise with no healthy retracements, bear markets of 60-80% magnitude have followed. It has happened on the 2013 run, 2017 and 2019.
Regarding Institutional Investors, some of these including GreyScale do have a reason to keep their BTC in cold storage and not move them, otherwise their whole business model wouldn't workout. Although, Hedge Funds that initially bought into bitcoin at 9-10-11 & 12k have quarterly and especially yearly quotas to meet. These are not moonboys that will hodl for years, and for them to realize a 90% profit in a month will result in big bonuses and performance packages. Why would they keep holding onto the btc? They won't.
Regarding the low volumes, many people have claimed that low volume is due to nobody buying but ALSO to nobody selling, which shouldn't be an indice to consider when making a price/value assessment. Let me inform you, it is. Low volume simply means that whales can't liquidate WITHOUT moving the market in a downward direction, they would crush the price quite quickly since there is not enough retail buyers in right now. That's why this rally is taking so long to end, they are waiting to get more retail buyers in but they are not coming so whales have to keep moving the price up to generate more hype.
Now, 19.5k might hold, or might have a wave of shorters pushing the price down. Both scenarios can happen and they are 50/50 % probability. No trades to make here that are on the safe zone. I would look for big volume candles to identify the top and wait for bigger price swings.
FEAR AND GREED INDEX: this index has historically been quiet on point for identifying bottoms and tops. It has now been hovering above 85 and 90 for over a week ( these are All-time highs!). Last bull-run in 2019 stopped the indicator at 92, we were at 95 yesterday. March 20th was a 6 (fear) to give you an idea.
Now, think for yourself, if greed is at record highs and nobody is trading the coin, wouldn't it indicate that any significant sale would trigger a sharp move? Prices are stagnant and barely moving because there is nobody IN the market now, and nobody and no institution in their sane mind will enter an asset that has gone up 90% in a month with not a single correction. So what move is to come? I have been through all of the last parabolic runs, and they were all different in the sense that there was significantly more hype and more price swings (indicative of hype).
PayPal news certainly started fuelling bitcoin's run, but let's remember well. That stopped at around 15,000-15,600. After which, many strange things started happening, including bitcoin going up many consecutive weeks with low volume and low general public interest.
Daily RSI is now hovering 85, but that is not the most interesting part. The interesting part is that the RSI has been above the oversold line for the longest period ever, including the 2017 bull run. It's now been since October 20th that the RSI has been significantly trading above those levels on the DAILY time-frame. RSI has been a fairly accurate indicator of subsequent price movements.
On the Weekly time frame, both the RSI and Stochastic RSI have been overbought. A pattern that we can't help but notice is the history of both RSI and Stochastic RSI being above the overbought line together. When this happens retraces of 20%+ normally happen. These haven't happened yet.
Additionally, every time that bitcoin had a parabolic rise with no healthy retracements, bear markets of 60-80% magnitude have followed. It has happened on the 2013 run, 2017 and 2019.
Regarding Institutional Investors, some of these including GreyScale do have a reason to keep their BTC in cold storage and not move them, otherwise their whole business model wouldn't workout. Although, Hedge Funds that initially bought into bitcoin at 9-10-11 & 12k have quarterly and especially yearly quotas to meet. These are not moonboys that will hodl for years, and for them to realize a 90% profit in a month will result in big bonuses and performance packages. Why would they keep holding onto the btc? They won't.
Regarding the low volumes, many people have claimed that low volume is due to nobody buying but ALSO to nobody selling, which shouldn't be an indice to consider when making a price/value assessment. Let me inform you, it is. Low volume simply means that whales can't liquidate WITHOUT moving the market in a downward direction, they would crush the price quite quickly since there is not enough retail buyers in right now. That's why this rally is taking so long to end, they are waiting to get more retail buyers in but they are not coming so whales have to keep moving the price up to generate more hype.
Now, 19.5k might hold, or might have a wave of shorters pushing the price down. Both scenarios can happen and they are 50/50 % probability. No trades to make here that are on the safe zone. I would look for big volume candles to identify the top and wait for bigger price swings.
FEAR AND GREED INDEX: this index has historically been quiet on point for identifying bottoms and tops. It has now been hovering above 85 and 90 for over a week ( these are All-time highs!). Last bull-run in 2019 stopped the indicator at 92, we were at 95 yesterday. March 20th was a 6 (fear) to give you an idea.
Now, think for yourself, if greed is at record highs and nobody is trading the coin, wouldn't it indicate that any significant sale would trigger a sharp move? Prices are stagnant and barely moving because there is nobody IN the market now, and nobody and no institution in their sane mind will enter an asset that has gone up 90% in a month with not a single correction. So what move is to come? I have been through all of the last parabolic runs, and they were all different in the sense that there was significantly more hype and more price swings (indicative of hype).