Bitcoin (BTC) Price Rally Above $56K Raises Expectations of Further Crypto Rebound

The recent Bitcoin (BTC) price rally above $56k has raised expectations of further crypto rebound in the coming days.

Bitcoin (BTC) price finally saw an increase in demand on Monday after a week of boring trading in a narrow range. The leading digital asset is trying to resume its upward trend after its recent sharp fall below the $53,000 level. However, technical indicators and chain data indicate that there is a possibility of a further increase in the price of Bitcoin in the coming days.

At the time of writing this article, the price of Bitcoin increased by 1.4% in the last 24 hours to reach $55,950. The price of BTC has increased by 0.2% in the last week and by 11.5% in the last month.

Bitcoin Daily Relative Strength Index (RSI) is forming a bullish divergence

While Bitcoin price has reversed in a range and shows little net demand, the relative strength index (RSI) is showing an uptrend on a daily basis. This indicates increased demand from large investors, as they ideally profit from short-term positions.

Typically, when the RSI rises in a downtrend, it indicates increased demand from whale investors who are taking profits on short-term positions. At the same time, when the RSI drops in an uptrend, it indicates increased demand from whale investors who are profiting from long-term positions.

In the third quarter of 2022, when the price of Bitcoin increased from the level of $24,000 to $53,000, the RSI showed a downward trend. This shows that whale investors have made profits in short-term positions.

However, since late September, the RSI has shown an uptrend, while the price of Bitcoin has reversed within a range. This shows that whale investors earn profits in long-term positions.

In the third quarter of 2022, when the price of Bitcoin increased from the level of $24,000 to $53,000, the RSI showed a downward trend. This shows that whale investors have made profits in short-term positions.

Meanwhile, since late September, the RSI has shown an uptrend, while the price of Bitcoin has reversed within a range. This shows that whale investors earn profits in long-term positions.

Bitcoin price rises after US spot ETFs gain $28 million net

Bitcoin price rose momentarily after US spot exchange-traded funds (ETFs) recorded net cash inflows of $28 million. Fidelity's Phillips Bitcoin ETF (NYSE:FBTC) led the way, registering net inflows of $15.5 million, regulatory data shows.

At the same time, chain data shows that the total supply of stablecoins on centralized exchanges has increased by about $300 million in the past 24 hours. This shows the increase in the movement of stablecoins to exchanges to buy digital assets.

It is more likely that the price of Bitcoin will increase until the financing rate in major exchanges becomes positive

Market data provided by the chain analysis platform Santiment suggests that the possibility of a further increase in the price of Bitcoin in the near term has increased due to an increase in short-term financing rates.

Ideally, an increase in short positions in digital currency exchanges would lead to their forced liquidation, which would attract whale investors to long positions in the instrument and vice versa.

As a result, Sentiment believes that the possibility of further increase in Bitcoin price in the coming days is higher until the funding rate in major exchanges becomes positive.

Bitcoin price shows mid-term price targets

We simply can't be friends if you think the biggest bullish flag in $BTC history is about to break pic.twitter.com/KpUMmrcw2p

before Consumer Price Index (CPI) data

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