The sales indicator TD9 emerged in the S&P 500 chart over several time frames. Considering the high level of correlation between Bitcoin and stocks, it could suggest a decline in the BTC price in the short term.
However, crypto currency traders do not seem to be disturbed by the vulnerability of stocks. Several traders anticipate that Bitcoin will rise in the middle of the USD 9,000 despite the TD9 signal for a correction.
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What is the TD9 system, and why might it imply a BTC rollback?
The TD9 sales signal is an indicator part of the widely cited TD Sequential system. It detects a potential trend reversal by identifying overextended corrections or increases.
A buy or sell TD9 signal appears when nine consecutive candles are higher than the previous four. As an example, let’s assume that Bitcoin’s price opened at USD 10,000 on a daily chart at the beginning of the month. If BTC closes above USD 10,000 for the next 13 days, a sell TD9 signal would confirm this.
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Typically, a 13-day rally with little setback leads to confirmation of a TD9 sales signal across many time frames. This week, a pseudonymous trader known as Fomocap said the signal emerged on the daily, 12-hour and 6-hour charts of the S&P 500:
„Signal TD9 confirmed on SPX: 1. D SPX 2. Multiframe: 24h, 12h, 6h.“
Skew’s data, meanwhile, shows that the price of Bitcoin has shown a relatively high level of correlation with shares since March. Therefore, if the stock market falls in the short term, it could affect the sentiment surrounding Bitcoin.
Bu, the trader stressed that the accuracy of the TD9 signal is debated because it can give false signals. In a rising market, for example, the price of Bitcoin shares or U.S. shares can continually see upward trends without major reversals. In that case, the TD Sequential system may be less effective. The trader said:
„It’s one of the many patterns of PA. Yes, basically the momentum. TD9 also gives many false signals. It is better to collect all the data, angles and views than to stay in the paradigm of one’s imagination. Just to stay on the radar.“
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Kryptonian traders remain optimistic about Bitcoin
At the same time, according to market analyst Michael van de Poppe, Bitcoin’s uptrend remains intact due to resistance in a strong support zone.
Bitcoin has remained above $9,200 for most of the last two months. BTC showed brief declines below USD 9,000, but the cryptomone recovered quickly.
The price chart of Bitcoin Up with a potential fractal upwards
The Bitcoin price chart with a fractal upward potential. Source: Crypto Michael
If BTC continues to defend the USD 9,200 level and goes above USD 9,300, Van de Poppe indicated that a rise above USD 9,600 is likely:
„So far, so good. Support is holding, the massive drop did not occur. If we go above $9,300, I think $9,600 is a likely target in the short term.“
Bitcoin trader Zoran Kole also suggested that the chances of Bitcoin’s upward trend continuing in the middle of the $9,000 – $10,000 range are still high.