Bitcoin Weekly Bullish Divergence Signals Possible Rebound Toward $90,000

A rare bullish divergence is forming on Bitcoin’s weekly chart, a pattern that previously appeared near the market bottom after the FTX collapse and was followed by a sharp rally.

Cointelegraph reported on June 8 that Bitcoin’s momentum indicators are improving even as the price declines, suggesting selling pressure may be easing.

Bitcoin’s weekly relative strength index, or RSI, is now above 34. The indicator had earlier fallen below 30, the threshold commonly viewed as oversold, before rebounding. Over the same period, Bitcoin fell from $75,770 to around $63,000.

While Bitcoin has posted a lower low in price, the RSI has stopped falling alongside it. In technical analysis, that pattern is known as a bullish divergence. It points to a setup in which price remains weak while internal momentum improves first, increasing the chances of a rebound.

If the signal is confirmed this week, it would mark only the second bullish divergence on Bitcoin’s weekly chart, Cointelegraph said. The first came after the FTX collapse in November 2022. Bitcoin then climbed about 715% from roughly $15,500 to around its all-time high near $126,200.

That has put short-term rebound targets back in focus. Cointelegraph identified the 50-week simple moving average, or SMA, near $91,755 as Bitcoin’s first major upside target. The level could act as dynamic resistance during a recovery attempt.

Bitcoin is also holding near its 200-week simple moving average. The 200-week SMA is around $62,000 and previously marked major lows near the end of the 2015, 2018 and 2020 bear markets.

Analyst Michaël van de Poppe called the 200-week SMA an “ideal accumulation zone.” For Bitcoin to confirm further strength, it would need to break above the $64,000 to $65,000 range, he added.

A move above that zone could lift Bitcoin to $71,500 to $73,000, van de Poppe said. It could then open the way to $79,000, where a Chicago Mercantile Exchange gap is located. He identified the area above $90,000 as the next resistance zone.

Downside risks remain. Cointelegraph reported that Bitcoin has already broken below the lower boundary of a weekly bear flag. A bear flag is a bearish pattern in which prices rebound within an upward channel after a steep drop before turning lower again.

If that pattern plays out, Bitcoin could fall below $50,000. To invalidate that bearish scenario, Bitcoin would need to reclaim the lower bear-flag trendline as support.

The market is now watching whether Bitcoin can hold long-term support near $62,000. The weekly bullish divergence points to rebound potential, but confirming a trend reversal would require a break above $65,000, a recovery into the $70,000 range and fresh buying in derivatives markets.