Bullish Reversal Pattern in Bitcoin

A technical analysis pattern hinting at a bull reversal has emerged on Bitcoin’s (BTC) daily price chart as traders await Wednesday’s U.S. inflation data to stabilize risk assets.

BTC has recently experienced a downturn, dropping from $100,000 last month to under $80,000 this week due to various factors, including risk aversion on Wall Street, concerns regarding Trump’s tariffs, and fears of a U.S. recession. Disappointment over a lack of new BTC purchases under Trump’s strategic reserve plan further fueled this decline.

However, while prices fell to multi-month lows below $80,000 on Tuesday, the Relative Strength Index (RSI)—a popular momentum oscillator—did not confirm this decline. Instead, it produced a higher low, contradicting the lower low on the price chart, indicating a bullish RSI divergence.

This divergence suggests that though the price is falling, the selling momentum is weakening, potentially signaling an upcoming shift toward a bullish trend.

The appearance of this pattern is timely, coinciding with the release of the U.S. consumer price index for February, set for 12:30 UTC, which is anticipated to reflect positive developments. The bullish divergence of the RSI indicates that the market may respond favorably to a potential soft reading.

According to CNBC, the data is projected to show that the headline CPI and the core figure, excluding food and energy, increased by 0.3% month-on-month in February. This suggests an annualized rate of 2.9% for the headline CPI and 3.2% for the core, both 0.1 percentage point lower than in January.

QCP Capital, a crypto trading firm based in Singapore, noted in a Telegram broadcast, “Tonight’s CPI print could set the tone for rate expectations, as markets now anticipate four Fed cuts this year, compared to just one in January. Will inflation data confirm this shift or induce fresh turbulence?”