Bitcoin’s Triple RSI Divergence Raises Liquidity Concerns

Bitcoin’s weekly chart has flashed a rare triple bearish RSI divergence, a signal that momentum may be fading.

According to Jamie Coutts, Chief Crypto Analyst at Real Vision and analyst at Bloomberg Intelligence, this setup often precedes periods of fragility across markets.

Divergence as a Warning Sign

Coutts compared the current pattern to historical moments in equities. Similar divergences appeared before the collapse of Long-Term Capital Management in 1998, the Global Financial Crisis in 2008, and again ahead of the pandemic shock in early 2020. Each time, markets showed strength on the surface while their underlying “engine” was already losing power.

Importantly, Coutts emphasized that divergence is not an automatic sell signal, but rather a red flag. It suggests that while prices remain elevated, momentum is no longer confirming the trend – leaving assets vulnerable to external shocks.

Macro Liquidity Holds the Key

For Bitcoin, the decisive factor remains liquidity from central banks. Coutts described Bitcoin as a liquidity-sensitive asset: when policymakers expand monetary conditions, the uptrend tends to resume. But if liquidity tightens, the risk of a broader rollover increases.

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“The resolution comes from the macro,” Coutts explained. “Spigots on means higher. Spigots off means rollover risk.”

Navigating the Setup

Traders and investors are urged to respect the divergence while keeping a close eye on liquidity trends. If global central banks initiate another round of easing, Bitcoin could sustain its upward momentum. Without that support, however, the divergence signals rising danger of correction.
Coutts summed up his base case with a phrase borrowed from science fiction: “The spice must flow.”