On Monday, Bitcoin (CRYPTO: BTC) spiked by more than 3%, breaking through the technical barrier at $28,500 and reaching new highs in 2023. The king of cryptocurrencies is now trading at the highest level in over 44 weeks.
The ProShares Bitcoin Strategy ETF (NYSE:BITO), the biggest exchange traded fund tracking the cryptocurrency, rose 5.2% on Monday, posting the seventh-best session so far in 2023.
John Bollinger, a well-known technical analyst and the originator of Bollinger Bands, recently said on Twitter that Bitcoin was about to experience a squeeze. The technical expert saw that the bandwidth of his beloved Bollinger bands was at its lowest in the previous 96 bars, which should warn a savvy trader of a change in the volatility regime.
A short squeeze did actually occur throughout the session, with BTC spiking higher.
$BTCUSD is in a Squeeze, at least as close to one as we are likely to get this cycle. It is the lowest value for BandWidth in 96 bars. I prefer a minimum of 125 periods, but this should alert the savvy trader of a coming change in the volatility regime.https://t.co/M4TgQwlbSL
— John Bollinger (@bbands) April 10, 2023
BTC/USD Technical Analysis: Retracement of The Bearish Trend At Play
BTC/USD Weekly Chart: TradingView
Bitcoin is up over 75% in 2023, but remains 57% below its all-time highs reached at the end of 2021.
Breaking firmly above the $28,200 barrier has been a key technical milestone for the cryptocurrency.
Bulls have currently retraced 23.6% of the major bear market, which connects the 2021 highs with 2022 lows.
This is a critical Fibonacci retracement level, and bulls may now set the ground for a shot at $36,000, the next crucial level at the 38.2% Fibo retracement.
The possibility of reaching this target increases if BTC makes a weekly close over the psychological $30,000 barrier, which is 3% above the current price.
On the downside, bears are now watching the overbought 10-week RSI for signs of a probable short-term reversal. Overall, the momentum is swinging towards the bulls, but a weekly closing below 30,000, along with RSI divergence, might be a valid excuse for bears to resurface.
Read next: One Crypto Analyst Is Predicting An Incredibly Massive Bitcoin Rally This Year. Here's Why.
Photo: Shutterstock
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