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Bitcoin (BTC) has declined by more than 10% in the last two weeks, falling from approximately $98,000 to around $86,000 at the time of writing. The high selling pressure has pushed the flagship cryptocurrency to oversold levels it had not seen since August 2024.
Bitcoin Is Oversold, Time To Buy?
According to an X post by seasoned crypto analyst Ali Martinez, BTC has entered oversold conditions it hadn’t seen since August 2024. Specifically, the Relative Strength Index (RSI) for Bitcoin has dropped to the lowest level in the last seven months.
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For the uninitiated, the RSI measures Bitcoin’s momentum on a scale of 0-100, with values above 70 signaling overbought conditions and below 30 indicating oversold levels. According to the following chart, BTC’s RSI has tumbled below 30, indicating the digital asset may be significantly oversold.
Notably, the last time BTC was this oversold – in August 2024 – it led to a 33% price surge, pushing the digital asset from $49,000 to $64,000 in two weeks. A similar trajectory today could propel BTC to around $110,000.
Acclaimed crypto investor The Wolf Of All Streets had similar thoughts on Bitcoin’s RSI. The investor shared the following 4-hour chart, saying:
Bullish divergence with oversold RSI still very much in play. At the moment, RSI still is making a higher low. We need to see a clear “elbow up” on the next candle to confirm. Nothing here yet.
Meanwhile, crypto analyst Rekt Capital predicts that there may be further downside for BTC. The analyst emphasized that BTC is getting closer to filling the Chicago Mercantile Exchange (CME) gap between $78,000 to $80,700, which was created in November 2024.
For the uninformed, a CME gap refers to the price difference between Bitcoin’s last traded price on the CME before the weekend and its price when the market reopens. Bitcoin is often believed to fill these gaps as part of a natural market correction, with the gap acting as a level of price support or resistance.
Mixed Opinion On BTC Price Action
The recent crypto market pullback has led to split opinions among analysts. For instance, a former Glassnode analyst recently said that the odds of being in a bear market are “not large.”
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Similarly, recent analysis by Andre Dragosch, European Head of Research at Bitwise, indicates that BTC may be undervalued at current market prices. On the contrary, Standard Chartered predicts that there may be another 10% drop in BTC price.
Although the opinion on Bitcoin’s short-term price action may be divided, the long-term bullish case for the digital asset remains intact. At press time, BTC trades at $84,963, down 2.4% in the past 24 hours.
Featured image from Unsplash, Charts from X and TradingView.com
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