- Bitcoin indicates recovery from a significant decline, driven by technical markers and historical trends.
- Analyst El Crypto Prof notes Bitcoin’s oversold potential due to RSI hitting a 20-month low.
- Bitcoin’s rebound potential observed after reaching $25,000 support; experts predict rally amid market factors.
Bitcoin (BTC) is displaying indications of a possible recovery after a significant decline that had a widespread impact on the cryptocurrency market as a whole. Experts are highlighting a blend of technical markers and past trends as factors for maintaining a positive outlook regarding the future performance of this digital asset.
Specifically, an individual known in the crypto community as El Crypto prof, in a post shared on August 20, highlighted that the recent drop in Bitcoin’s value has led to the Relative Strength Index (RSI) reaching its lowest point in more than 20 months, suggesting a potential situation of overselling.
The expert observed that Bitcoin had attained a pivotal support level, which had previously served as a resistance point for almost a year. Of special significance is the historical connection between BTC’s RSI dropping below 30 and the ensuing shifts in price. As per the analyst’s observations, on each occasion when the RSI has gone below this specific threshold, Bitcoin’s price has experienced a substantial increase, ranging from 28% to a remarkable 60% in the aftermath.
After the recent adjustment in Bitcoin’s valuation, wherein the asset retraced to the $25,000 threshold, investors and traders might find reassurance in this trend, as it suggests that the current market situation could potentially pave the way for a noteworthy upward price surge.
Amidst this recent corrective phase, experts have recommended that investors keep a close watch on the support region around $25,000. Simultaneously, the prevailing agreement indicates that Bitcoin is poised to encounter a forthcoming rally, propelled by factors like the potential endorsement of a conventional Bitcoin Exchange-Traded Fund (ETF) and the upcoming halving event.
Significantly, a sequence of events, including reports of Elon Musk’s SpaceX allegedly divesting its Bitcoin assets, stirred unease within the market. This choice came after indications that the aerospace company had recorded a devaluation of $373 million. However, the precise moment when this selling-off occurred remains indeterminate.
Meanwhile, Bitcoin is concurrently undergoing a decrease in essential on-chain indicators. For example, according to a Finbold report, the monthly trading volume of Bitcoin on major cryptocurrency exchanges has recently descended to its lowest point over the last five years. Moreover, Bitcoin has succeeded in recovering the $26,000 mark and is presently being traded at $26,171, showcasing a daily increase of slightly less than 1%. Nonetheless, when examining the weekly chart, it becomes evident that Bitcoin’s valuation has fallen by over 10%.
Summarizing the technical analysis data gathered from TradingView, the sentiment score for the asset stands at 14 for ‘sell,’ consistent with the moving average score of 13. In contrast, the oscillators convey a sentiment score of 6 for ‘buy.’ Additionally, it’s crucial to acknowledge that beyond the historical chart pattern, Bitcoin’s valuation is influenced by an array of elements, encompassing macroeconomic trends and regulatory shifts.
