Bitcoin (BTC) toll has gained more than 10% in the last week, giving bulls some promise that the road ahead is a bright i for the leading digital asset.

However, despite an effort to nail through the disquisitional resistance level of $vii,200 every bit mentioned in last week's assay, there was a huge rejection bringing home the reality that perhaps information technology may be a piddling too soon to be expecting a miraculous bounciness dorsum to the $eight,000+ levels.

Daily crypto market performance

Daily crypto market performance. Source: Coin360.com

$5,500 then moon?

BTC USD daily chart

BTC USD daily chart. Source: TradingView

I think information technology'due south condom to assume that Bitcoin has settled dorsum into the descending channel that formed in the 2nd half of 2022. As Bitcoin has now non simply bounced off back up on the daily, leaving zip but a wick, simply it has at present done exactly the same with the resistance.

To me, this validates the aqueduct even more so than earlier, every bit the price is currently post-obit a path marked I marked out in yellowish, on a video I published to YouTube on March 31. This was one of three scenarios I was waiting on, and the one I felt that was most probable.

Equally such, since Bitcoin cannot seem to intermission out higher up $7,200, information technology seems probable that bears might exist about to regain control alee of the much-anticipated halving event, and this puts $5,500 as the disquisitional price to hold before inexpensive corn is dorsum on the carte.

Nonetheless, many primal indicators are contradicting this sentiment.

Is momentum returning?

BTC USD weekly MACD chart

BTC USD weekly MACD chart Source: TradingView

During sideways market periods, it is piece of cake to get chopped up and spat out when working off lower time frames, and often a glance at a higher time frame can assistance validate your bias. However, one such indicator that isn't good for bears right now is the weekly moving boilerplate divergence convergence (MACD) indicator, as this is now mooing to the herd.

As can be seen from the chart, the MACD is already starting to pinch towards the signal line. Since we have had a relatively bullish calendar week, we should see this move in fifty-fifty more so when the weekly candle closes, bringing usa closer to a bullish cantankerous, which typically results in a sustained uptrend, which almost always lasts over a month if not several.

Even so, right now, in that location are bigger things happening in the globe that may invalidate this as a possibility, and my business is that we will begin to meet a pregnant reduction in retail ownership power due to the rise in unemployment resulting from the coronavirus lockdowns.

While the worldwide quarantine is in the early stages — with many believing it will only last a couple of weeks — y'all only need to look at Red china to see that this will final a lot longer, so who exactly would exist buying?

The answer may lie in the Relative Strength Index, which could be enticing smart money into crypto.

RSI hinting at a bounce

BTC USD weekly RSI chart

BTC USD weekly RSI chart Source: TradingView

The last time Bitcoin approached oversold territory on the weekly, it experienced a 300% price increase inside six months equally can exist seen on the Relative Strength Index (RSI) indicator. This is based on the December. 10, 2022, pivot from 29.07 on the RSI calibration.

However, Bitcoin had already experienced a bounce on the RSI on March nine, 2022, when it was 33.37 on the RSI scale, and even with the colossal dump on March 12, the RSI is still trending upwards. This brings to light two pertinent questions:

  1. Will Bitcoin see another 300% price ascension inside a like timeline later the final oversold pin?
  2. Was the price purposely pushed downwardly later March 9 to load up on cheap BTC for a high probability of 3x?

Simply perchance some other clue every bit to what can be expected from Bitcoin over the coming weeks can be constitute in the mining difficulty charts?

Mining difficulty drop is slowing

BTC mining difficulty

BTC mining difficulty. Source: BTC.com

The Bitcoin mining difficulty dropped by a monstrous -xv.95% — the biggest since 2022 — on March 26, an adjustment that helped ease miners' concerns surrounding profitability. This fourth dimension final week, it looked every bit if the mining difficulty would drop past a further -14%.

Notwithstanding, as the calendar week has progressed the adjustment estimate has dropped to merely -2.2% and with 3 days left to go, this could end up closing as a positive adjustment.

Yous simply accept to look at the impact the positive adjustments had on the price of Bitcoin this year to see what this could exist still another bullish indicator.

Bullish scenario

All the indicators are bullish, and so why does information technology feel bearish? Right at present we are at the top of a valid channel, as such a breakout could well be imminent. For this to happen Bitcoin would need to flip $7K resistance into support and from hither $8,200 looks similar the next level of resistance we would encounter.

Bearish scenario

The price of Bitcoin has already doubled since its recent bottom, as such a pullback to $five,500 over the next week would be completely reasonable to expect.

If this level fails to concur, then information technology opens up $3,900 as a possibility. If bulls don't step in then, I'd exist very surprised.

The views and opinions expressed hither are solely those of @officiallykeith and exercise not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. Y'all should deport your ain enquiry when making a conclusion.