Bitcoin most overbought since record run, Technical Gauge says

Here’s something for recently emboldened crypto enthusiasts to mull: Bitcoin is now at its most expensive level since just before the spectacular crash of the most widely owned digital currency.

As the coin’s price broke above $5,000 for the first time since November this week, the GTI Global Strength Indicator, a technical analysis tool, showed it’s the most overbought since its run-up to nearly $20,000 in December 2017. Similar patterns have in the past presaged multi-week downturns. Bitcoin climbed another 3 percent on Friday.

“The market got so compressed, volatility was so low, it just went poof! It broke out. It was released from the cage,” said Bloomberg Intelligence analyst Mike McGlone. “Now it’s a question of duration and I suspect when you have such a massive bubble, you’ll always have an overhang of people who need to sell.”