One key Bitcoin (BTC metric) has reached its lowest level since March 2020, months after the market crash.
Popular analysts noted that Bitcoin’s relative strength indicator (RSI), is showing a “hidden bullish divergence”, on monthly timeframes. If it happens, they claim, the result will be very satisfying for hodlers.
RSI drops below the summer 2021 floor
It is not hard to see that many on-chain indicators have long demanded higher prices despite frustration over the lack of direction regarding BTC/USD.
Although the current price of Bitcoin may fall further, the classic RSI metric shows how “oversold” Bitcoin at this price.
Popular analyst Matthew Hyland stated that the Bitcoin monthly RSI was currently lower than the May-July 2020 correction. This refers to Bitcoin’s summer correction following the May miner upheaval.
Compared to that time, BTC/USD was at $30,000 and monthly RSI at around 60. Now, the price is just 58.95. Only September 2020 saw the metric drop to around $10,000 with BTC/USD hovering at about $10,000.
BTC/USD 1-month Candle Chart (Bitstamp), with RSI. Source: TradingView
TechDev, a fellow analyst and trader, responded that monthly RSI is also printing a pattern that has not been seen before.
“I could only find one hidden monthly bull dip in Bitcoin’s history. He wrote, “Let’s see if that confirms.”
RSI, which is used traditionally to determine the overbought and oversold status of an asset at a particular price point, has been particularly useful in Bitcoin’s recent months.
TechDev pointed out that RSI was at 68 in mid-October. However, this level is still well below the point where Bitcoin reaches its long-term tops.
Timing your exit
Bitcoin, however, is not proving to be a bright future for everyone.
Related: Bitcoin open-interest matches record high amid predictions for BTC price “fireworks” this month
Popular traders often have high price targets that they believe must be met if the market is to turn bullish.
Pentoshi is one of them. He stated that he would only reevaluate market in a macro perspective after $58,000-$60,000 returns.
He argues that the structure of the market in 2022 is completely different from any other point in the period starting in March 2020.
“The odds aren’t in our favor imo. He said that Q1 offers some decent exits, but he was not optimistic.