With Bitcoin’s price remaining below $100,000, experts caution that it may not be the ideal time for new long trades.
Bitcoin (BTC) is still hovering above $100,000, yet signs of a slowdown are emerging, prompting analysts to advise caution regarding long positions. Following a recent surge past $102,000 after a fall to $91,229 on February 3, the Relative Strength Index has been stabilizing.
“Historically, Bitcoin has shown solid buying opportunities only when the RSI drops to around 40%,” noted analysts from blockchain firm Matrixport in a Feb. 5 research note. As of this writing, the RSI is at 48%, a level deemed too elevated to initiate typical market patterns for ideal entry points, according to the analysts. Given this uncertainty, Matrixport recommends that investors remain patient and seek a more favorable buying opportunity.
The spike on February 4 followed a significant decline driven by concerns over proposed tariff increases by President Donald Trump, which raised fears of a potential trade war. However, Bitcoin’s price rebounded after Trump decided to temporarily suspend the tariffs.
This recovery was also bolstered by a substantial liquidation of speculative positions. The crash on February 3 marked the largest liquidation event in crypto history, surpassing both Terra and FTX, as reported by crypto.news reported. On that day, the crypto market experienced a sharp downturn, with over $2.3 billion in leveraged crypto positions liquidated in just 24 hours. Other estimates suggest the total liquidations could reach between $8 to $10 billion.
As market volatility persists, analysts advise that adopting a “more strategic approach” by exercising patience and waiting for an ideal entry point would be prudent.
