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#BTC Hits New High#
The cryptocurrency market is witnessing a sudden spike in volatility on Tuesday, following a strong rally the day before. Bitcoin (BTC) is trading at $116,918, down more than 2% on the day, as investors take profits ahead of the release of the U.S. Consumer Price Index data for June.
Chart of the day: Can Bitcoin resume its upward trend?
Bitcoin's price is trading down 5% from its all-time high, reflecting increasing volatility and profit-taking. The reversal of the Relative Strength Index (RSI) from the overbought area to the neutral zone on the daily chart suggests a fading bullish momentum, which may encourage traders to reduce their market exposure.
If the decline continues, temporary support may arise from the buyer congestion area between $115,000 and $116,000, as tested on Friday.
However, the upward trend may resume if traders maintain their steadiness, as evidenced by the Money Flow Index (MFI) which is steadily moving around 80. This tool tracks the amount of money flowing into or out of Bitcoin. If the upward trend resumes, the increased demand for Bitcoin may bolster support, pushing the price above $120,000.