In summary:
Bitcoin reached a new all-time high above $108,000 on Jan. 20, gaining over 8% in the past week despite signals of weakening momentum.
The DMI and RSI indicators suggest declining bullish pressure, with rising selling pressure hinting at a potential consolidation phase.
BTC could test $110,000 if upward momentum recovers, but risks falling to crucial support levels below $90,000 if the trend reverses.
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The price of Bitcoin (BTC) has increased by over 8% in the past seven days, reaching a new all-time high on Jan. 20, 2025, when it surpassed $108,000 for the first time. This notable surge has fueled speculation about whether BTC’s uptrend will continue to test new resistance levels or face a potential correction.
Despite the bullish momentum, technical indicators like the DMI and RSI suggest that the trend strength may be weakening, with sellers starting to exert more influence.
DMI Shows Sellers Gaining Control
Bitcoin’s DMI chart shows that the ADX has decreased to 23.2 from 30.7 over the past two days, indicating a weakening trend. The ADX measures trend strength, with values above 25 signaling a strong trend and those below 20 suggesting a lack of direction. The current reading below 25 suggests that BTC’s upward momentum is losing strength, potentially hinting at a slowdown in market activity or a pause in the uptrend.
Meanwhile, the +DI has sharply declined from 34.8 to 19.7 in one day, reflecting decreasing buying pressure, while the -DI has increased from 17.8 to 26.6, indicating rising selling pressure
This shift suggests that while BTC is technically still in an uptrend, the weakening +DI and strengthening -DI indicate the market is losing momentum. If this trend continues, Bitcoin’s price could enter a consolidation phase or risk a reversal, especially if the -DI crosses above the +DI, signaling bearish dominance.
RSI Shows Decreasing Momentum
BTC’s RSI is currently at 50.9, down from 65.5 just one day ago, indicating a shift in momentum. The Relative Strength Index measures the speed and magnitude of price movements on a scale of 0 to 100, with values above 70 suggesting overbought conditions and a potential price correction.
Conversely, values below 30 indicate oversold levels and a possible recovery. A reading around 50 signals neutral momentum, suggesting neither buyers nor sellers have a clear advantage.
With BTC’s current RSI at 50.9, it reflects a balance between buying and selling pressure, but the recent decline from 65.5 suggests weakening bullish momentum.
This could indicate that BTC’s recent upward move is losing steam, with the price potentially entering a consolidation phase. If the RSI continues to decline toward 40, it could suggest increasing bearish momentum, while a recovery above 60 could reignite bullish sentiment.
BTC Price Prediction: Can Bitcoin Reach $110,000?
BTC’s EMA lines show that it is currently in an uptrend, with shorter-term lines positioned above longer-term ones. However, the narrowing distance between these lines suggests that bullish momentum may be weakening, signaling a potential slowdown in trend strength.
If the uptrend regains strength, the BTC price could test the resistance level at $105,700, and a breakout could push the price to $108,500. Stronger bullish momentum could even take BTC to $110,000 for the first time.
Conversely, if momentum falters, the BTC price could test the support level at $98,800, with the potential to decline to $97,800 and $91,200 if that level is lost. A further decline could see the BTC price drop below $90,000 to test the crucial support at $89,400.
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