A closely followed crypto analyst says that Bitcoin (BTC) may suddenly turn bullish based on one key indicator.
In a new post, crypto trader Rekt Capital tells his 542,500 followers on the social media platform X that the Relative Strength Index (RSI) – a momentum indicator used to indicate overbought or oversold levels – may soon break out of a downtrend, signaling bullishness for Bitcoin.
[adinserter block="1"]“Going forward, it will be worth watching this daily RSI downtrend for a breakout in the future. This downtrend has been a resistance on the RSI since November 2024. An RSI downtrend break would likely precede a trend reversal to the upside in price.”
In a strategy session, the analyst tells his 107,000 YouTube subscribers that the RSI has bounced off the oversold level in the 20s range, which historically has led to a price reversal for Bitcoin.
“We’ve dropped into a zone of overselling, so below the 30 RSI, that’s typically where we see sellers get a little bit too enthusiastic. People are selling too much, and the sellers are slowly getting exhausted. They are overselling, which means that it’s easier for buyers to step into the market and start buying up prices, and they don’t even need to buy up on high volume.
And it’s already pressing prices up quite nicely towards the upside without much effort. And that’s exactly what happens when sellers are exhausted. And we’ve seen these oversold regions on quite a few occasions across this cycle. And each time we got here on that first crash, we were very close to a bottom, or we were at a bottom already, and we’d see price reverse towards the upside.”
The analyst also says that Bitcoin’s retracement from the all-time high is not out of the ordinary based on historical precedence.
“This current pullback (-29%) is one of the deeper retraces in the cycle but it’s not extraordinary. After all, we’ve seen a deeper retrace in the immediate post-halving period (-32%). Not only that, but we’ve seen deeper pullbacks in previous cycles.
Major 2021 corrections: -31%, -55%, -25%.
Major 2017 corrections: -34%, -34%, -38%, -40%, -29%.”
Bitcoin is trading for $83,112 at time of writing, flat on the day.
Follow us on X, Facebook and Telegram
Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
Surf The Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any assets including cryptocurrencies, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Generated Image: Midjourney
