We have broken out of a two-year downtrend on the RSI and are now retesting it, in an exact similar fashion as done in 2019.

We all probably have heard enough “BTC broken out of xy downtrend“ after last months rally but many may not realize that more important than breaking out of a downtrend is not as important as actually being able to successfully retest it and confirm the break-out with that, there have been a lot of false break outs in the past too. Here there has been a new, good and bullish, development in the past days.

Bitcoin broke out of a two-year downtrend at the Relative Strength Index (RSI), with the rally last month. The RSI is used to show the speed and momentum of the price movements (More about it on my post, here) and has thus been in a donwtrend since we mooned in eary 2021 to $35k, which is logical as each rally after that was smaller.

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Chart from CryptoCon on twitter

Here we can also see that after this break out the RSI has gone down as we are going sideways now and not having big price rallies, right now we have made the first few bounces above this RSI diagonal line, showing that it could be a very succesful retest and confirm the break-out which woudl be even more bullish.

It is also interesting to see that after our reversal in 2019 the exact same happened, we broke out of a long-lasting RSI donwtrend and after the first rally we started retesting this diagonal line as support, we did that three times and each time successful causing us to go further up after each touch with the line.

The same may be happening now, we will rally up after a retest of it but will kepp coming down to retest it again. The way up is not always as simple as you may think.