Since this month’s cryptocurrency surge was so strong, traders are keeping an eye out for the price bottom. Is the market ready yet, or will bears drive prices back to the $20K crucial optical support level? With unusual RSI readings, analysts are now trying to identify Bitcoin’s bottom.
According to trader Crypto Wolf, a significant narrative now in motion sets Bitcoin’s most recent rally unique from all others. On January 18, he observed that RSI had printed a bullish divergence on weekly timescales.
“BTC printed a rare weekly RSI bullish divergence. Never happened in BTC history, a once in a life opportunity. Technicals were there, charts were screaming bottom but as usual majority was in full bear mode,” Wolf said.
Trader Tardigrade, better known as Alan on social media, a trader and analyst, believes that the good times will last for a while as he expects some consolidation.
“On daily chart, 1. RSI Strong uptrend to overbought zone 2. $BTC had a significant drop before that 3. Sudden buyers bought up $BTC. Big rally will be following after some consolidation,” he noted.
At the time of writing, the daily RSI was close to 87, which is the highest reading since January 2021, months before the price of bitcoin to the dollar reached new all-time highs of $58,000 in April and $69,000 in November.
Three of the ten highest RSI readings for 2019 were recorded by BTC within the past two weeks. Its reading of 89.3 on January 14 came in third, with readings of 80.8 and 90.9 on January 16 and 17, respectively. Since 2019, out of over 1,500 trading days, Bitcoin’s RSI has only fluctuated between 78 and 79 ten times.