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John Bollinger urges traders to be careful about the Bitcoin price

June 3, 2020

The Bitcoin (BTC) price has peaked at $ 10,300 this week Investors should be prepared for losses, the renowned analyst John Bollinger warned.

In one Tweet As of June 2, the creator of the Bollinger band indicator said this The short trip of the largest cryptocurrency to the three-month highs was an anomaly.

Bollinger to dealer: be careful or go too short

Based on charts showing Bollinger Band’s behavior for BTC / USD this week, The $ 10,300 surge led the pair into an area that normally dictates an impending bullish surge.

John Bollinger urges traders to be careful about the Bitcoin priceJohn Bollinger urges traders to be careful about the Bitcoin price

The Bollinger Bands Use two standard deviations to draw a limit above and below an average price simple cell phone. Typically, this is the 20-day moving average.

When the price of an asset moves out of the gap between the two bands, the event indicates that volatility is rising or falling. This behavior tends to be preceded by a narrowing of the contours of the strips.

Bitcoin narrowed to the area between the two bands in May, indicating lower volatility. For Bollinger himself there was no reason to look out for the hint that the outbreak this week was real.

He tweeted:

“Bollinger’s top ribbon head is a fake for the $ btcusd, time to be careful or neglect.”

BTC / USD chart shows the most recent

The BTC / USD chart shows the current “wrong head”. Source: TradingView

Bitcoin’s own mutiny?

The indicator has previously shown the effectiveness of tracking Bitcoin’s bullish and bearish cyclesand the beginning of 2020 was no exception. There was a band tightening in December, followed by a steady increase earlier this year.

Bollinger’s warning comes when Bitcoin appeared to be winning due to US unrest and falling dollar values. As Cointelegraph reported, panic has also fueled gold Any significant gains for Bitcoin could depend on how events unfold.

Fundamental strength is slowly recovering from last month’s weaknessMiners are expected to continue improving within two days after a second negative difficulty adjustment.