BTC rallies above $21,000 as the US dollar index shows signs of cooling off, but is the wider crypto market beginning to reverse its bearish trend?
The relative strength index (RSI) has risen into the positive territory and the 20-day EMA is flattening out, indicating that the bears may be losing their grip.
The 50-day simple moving average (SMA) ($21,981) may act as a minor hurdle, but if bulls overcome it, the BTC/USDT pair could rally to the overhead resistance at $25,211.
A break and close above this level could complete a double bottom pattern. Such a move may signal the start of a new up-move. The pattern target of this reversal setup is $31,796.
Contrary to this assumption, if the price turns down from the 50-day SMA or $25,211, the pair could enter a consolidation for a few days.
The 4-hour chart shows that the pair picked up momentum after breaking above $19,520.
If the price turns down from the current level or the overhead resistance at $21,900 but does not break below $20,576, it will suggest that the sentiment has changed from selling on rallies to buying on dips.