Bitcoin leaves oversold RSI territory on Daily chart

[dragonvslinux]

After reaching similar oversold levels to January this year (~20), yesterday Bitcoin closed it's first Daily candle above oversold levels (<30) on the Relative Strength Index (RSI):



In January this led to a 35% increase in price from $35K to $48K in the months to follow, but in May this was only a dead cat bounce from $28K to $32K before further downside. The equivalent rebound in percentage terms, even if price is to go lower, would be $19K to ~$25K.  Meanwhile, the Weekly RSI remains considerably oversold after reaching lower levels ever seen and is currently 27.5.

Are you still expecting further downside before a recovery?

[jackg]

The rsi relies quite a bit on momentum too though, in the past when bitcoin has been oversold it's taken time and stagnation to bring it back to neutral (~50-60).

I've seen long times of flux between those levels too (particularly 2018) so it's possible we could see the start of that.

I think we're due some stagnation if we're in a bear market (and then for selling pressure to have an effect when buyers see nothing has happened for a while).

[STT]

Good trading indicator, not sure if we are proven medium term yet though.  I use OBV which includes volume as well, depends on the exchange as volume is split also but roughly I find it useful.  That indicates we are fairly neutral now and with alot left to prove before prices into 30k or above is reliably achieved.
   In momentum terms we are above weekly average and so long as we're staying above 20.5k I'm willing to take market as positive.  Also above 2 day average so its been quite a good week, closing the weekly bar will help with the longer term picture I guess; however just being flat today and tomorrow leaves us below the 200 week average & some will be shaken by that a little.   Momentum is fragile

[goaldigger]

This could be the start though we can stay longer on the oversold level but sooner or later, we will surely bounce back and fill that gap. We stayed longer on this level before and we might wait a little longer with the current trend. We all know the next big thing will happen if a coin reach the oversold level, up trend are more possible to happen so better to watch out this but don’t expect too much and stay focused on that analysis.

[Poker Player]

Are you still expecting further downside before a recovery?

In principle, it seems to me that the worst is over and that we could go up from here, but I don't expect much for the rest of the year. But as I do not like to look only at indicators, I do not rule out that there is some event that will push the price down, so I think we would go below $17k and we would be close to the Celsius liquidation price, if they do not add more collateral to lower the liquidation figure as they already did.

But I think the figures below $20k are strong support and the rebound from falling back to those levels would not take long. What is clear to me is that the best of the cycle has already passed, unlike some, who I see them making some predictions that they seem to think they are in November 2021, and have not heard about what has happened after that.

[Tytanowy Janusz]

We are in formation so big, that the best is to start looking at weekly or even monthly candles because dump is like 220 days old where last 3 months was only down without even a small dead cat bounce. And on the weekly candles bitcoin was not as oversold as it is now ... never.



Same on the monthly candles.

Recovery to 25k and even 30k is very possible even if we are about to see 10k per bitcoin in 2023.

[hugeblack]

Is the scenario returning to 10K levels due to the recurrence of the pattern of the year 2018/2019 and then predicating what happened to the price now, or is there anything that supports this, whether it was from a technical analysis or any non-historical reason?

I don't know, but the analyzes quickly turn negative with price changes, meaning if we go back to the 50k levels, we may not hear 10k voices, despite all the current patterns.

In general, the forecast for the coming year will be linked to external factors that were not available in the past.

[dragonvslinux]

Price is currently at the lower band of local volume support around $20K. This is starting to look similar to $28.5K to $30.5K trading range, so while it doesn't look immediately hopeful, it's more likely price will return to the upper boundary of volume around $21.3K in order to retest resistance levels before any further downside.



At least this time around there is some volume low down (around $19K) to act as support, but it's far from substantial. A temporary break of $20K wouldn't be confirmation in itself of further downside it seems. The month ends tomorrow, so ideally price would return to the 50 Month MA by end of day for a close around $21.3K. Another close below the 200 Week MA (without continuation of downside) would be insignificant imo.

The Daily RSI otherwise remains bearish but hasn't yet returned to oversold conditions. A return to oversold conditions would more or less confirm a dead cat bounce:



If the RSI can bounce from 30 (oversold level), possibly around $19K prices, then it would provide some hope, especially with the Weekly RSI still considerably oversold.

[fzkto]

Many indicators now show oversold and absolute bottom, but the various formations that have been repeated in the past are now broken. Bitcoin has not yet faced a global crisis, so anything can be expected. There has been talk of a bounce for a long time, but it's still not happening. When bitcoin was at 30k, no one believed it would be possible to buy it now at 20k. The same thing could happen at 10k.

[Webetcoins]

Is the scenario returning to 10K levels due to the recurrence of the pattern of the year 2018/2019 and then predicating what happened to the price now, or is there anything that supports this, whether it was from a technical analysis or any non-historical reason?

I don't know, but the analyzes quickly turn negative with price changes, meaning if we go back to the 50k levels, we may not hear 10k voices, despite all the current patterns.

In general, the forecast for the coming year will be linked to external factors that were not available in the past.

This is basically just a way of saying that bitcoin could go up on a whim because of a big great news, which it could, then all the charts would be useless. You are right that it could and we have seen it do both ways for the same thing, but that doesn't mean that we shouldn't check the charts and try to read what it is saying.

I know that we should be not trusting charts alone and we should be ready for anything that could happen, but that doesn't change the fact that crypto is a volatile thing and it could go either what the charts are showing, or it could literally go the opposite way and it could screw us all. Which one it will do? We have no idea.

[dragonvslinux]

Currently today's Daily RSI is returning to oversold. If today closes oversold it would invalidate any hope for further upside for the time being, even with the Weekly RSI so oversold.



The only hope I see is that the $19K level holds and price reverses today where there was previous trading volume. Below this level I think the next target would be around $16K minimum.



Bouncing from current prices could still confirm support from the Daily RSI bouncing from oversold conditions, but so far this has yet to be seen as support remains minimal.

This is also the last day of the Month. Currently the Monthly candle is down -40%, which is the worst Monthly candle Bitcoin has ever seen if it closes today at current prices. Previous worst ever Monthly candles were around -36% in 2021, 2018, 2015 and 2013. The only hopium is that these capitulation candles often come near the lows (excluding 2013), without ruling out a further -20% downside however (2018 and 2021).

[dragonvslinux]

Currently today's Daily RSI is returning to oversold. If today closes oversold it would invalidate any hope for further upside for the time being, even with the Weekly RSI so oversold.

Price avoided closing yesterday in oversold territory, but based on today's price action the RSI is returning to oversold. This is therefore the same bearish scenario as yesterday.

The only hope I see is that the $19K level holds and price reverses today where there was previous trading volume.

Well we got a strong 10% bounce from $19K support level, but price was rejected close to volume point of control just as quickly, confirming it as new local resistance:

Bouncing from current prices could still confirm support from the Daily RSI bouncing from oversold conditions

Similar story as yesterday, but price needs to return to a higher level than yesterday based on RSI, around $19.6K-$19.7K, and follow through in the coming days... It's a lot to ask for right now.
Given price has already bounced once from local support, only to confirm more resistance above, it looks like less likely to do so as the support weakens, even if still possible.

This is also the last day of the Month. Currently the Monthly candle is down -40%, which is the worst Monthly candle Bitcoin has ever seen if it closes today at current prices. Previous worst ever Monthly candles were around -36% in 2021, 2018, 2015 and 2013.

With yesterday's bounce the month closed at -37%, as opposed to -40%, making it only one of the worst candles in history since 2011, rather than the worst ever.

The only hopium is that these capitulation candles often come near the lows (excluding 2013), without ruling out a further -20% downside however (2018 and 2021).

That's it.

[dragonvslinux]

Price avoided closing yesterday in oversold territory, but based on today's price action the RSI is returning to oversold. This is therefore the same bearish scenario as yesterday.

Daily RSI yesterday closed back into oversold territory @ 28.9 for the first time since June 13th, even if not in a completely disastrous manner.

Given price has already bounced once from local support, only to confirm more resistance above, it looks like less likely to do so as the support weakens, even if still possible.

Despite twice falling to $19K, price has yet to break this support. Some analysts are now considering this a symmetrical rising with higher lows and lower highs. While this means a push back to the resistance level of $21K and volume point of control becomes more likely, this is otherwise a bearish continuation pattern within a strong downtrend, with further consolidation expected in the near term to fill out the triangle.



The Daily RSI would again be leaving oversold territory above $19.7K. Closing the day above this level makes a push to $21K more likely. Failure to do so makes the possibility of a bounce less likely.

[dansus021]

i just take a look at coinglass today and see the long and short ratio


i mean the chart is looking good the long position at 49% and yeah the short still have high position here but this can be indicator right I took at 24 hour timeframe

[dragonvslinux]

Despite twice falling to $19K, price has yet to break this support. Some analysts are now considering this a symmetrical rising with higher lows and lower highs. While this means a push back to the resistance level of $21K and volume point of control becomes more likely, this is otherwise a bearish continuation pattern within a strong downtrend, with further consolidation expected in the near term to fill out the triangle.

Price is again attempting to bounce from $19K and currently testing resistance at $20K, confirming a higher low on short-term time-frames and a symmetrical triangle consolidation structure:

The Daily RSI would again be leaving oversold territory above $19.7K. Closing the day above this level makes a push to $21K more likely. Failure to do so makes the possibility of a bounce less likely.

The RSI has again left oversold conditions, at a lower price this time it seems, around $19.5K, arguably finding support again from oversold conditions on the Daily time-frame. While some media outlets have incorrectly reported on a bullish divergence of the RSI on the Daily time-frame since falling below $20K, this isn't the case as the recent Daily closes didn't fall below the close of June 18th, even if this is a bullish sign in itself of making a higher low. Price has otherwise found support from the level it needed to find support from, which is a positive sign in a short-term. Getting rejected again from $20K again would further confirm the resistance above however, as what happened on July 1st, otherwise the target for the current move in the short-term would be $21K as referenced two days ago.

[STT]

We have positive momentum making attempts to break through again with 3 different attempts on the weekly average in the last week I have to agree the possibility of a positive trend should back on the watchlist seems like a fair call to me.
   I dont usually watch RSI but OBV says we dont simply rise, the price is more positive then volume accumulation but if we can break and hold above 20k thats got price action resolving positively.  Ideally we keep doing this over weeks and months and its less doubted then.

[dragonvslinux]

We have positive momentum making attempts to break through again with 3 different attempts on the weekly average in the last week I have to agree the possibility of a positive trend should back on the watchlist seems like a fair call to me.

It looks hopeful, but without a break of $20K then we are stuck below resistance (and further confirming it). Without a break of $21K price is still consolidating sideways in a bear trend continuation pattern. For longer-term trend, price needs to close back above the 200 WMA and clear $23K. Then we can consider a trend reversal in a more serious manner. For now, I just see short-term relief rally, until proven otherwise.

While this means a push back to the resistance level of $21K and volume point of control becomes more likely, this is otherwise a bearish continuation pattern within a strong downtrend

[GreatArkansas]

Staying above $20,000 this week is a good sign for me. And next week is the time to test the $20,000 area.
Seems the RSI level staying in oversold area was a signal for a buy a few days ago especially when the monthly candle opens this July.
I am waiting for the time we test the $20,000.

[aoluain]

A friend of mine who watches the charts ^{I dont} has mentioned to me on Sunday
that they are expecting a "buy signal" to flash in the next few days because of some hash ribbons
crossing which only happens like once a year or so, so yea I voted for $25k! it all sounds good, I dont
fully understand it but there definitely seems to be more action with the prices moving wildly and
daily between $18k and $20k.

There seems like something is going to happen......

[dragonvslinux]

A friend of mine who watches the charts ^{I dont} has mentioned to me on Sunday
that they are expecting a "buy signal" to flash in the next few days because of some hash ribbons
crossing which only happens like once a year or so, so yea I voted for $25k! it all sounds good, I dont
fully understand it but there definitely seems to be more action with the prices moving wildly and
daily between $18k and $20k.

Thanks for the reminder +1! Had forgotten to check hash ribbons today until you posted this. It's true, the indicator is signalling that hash rate has recovered from it's correction (and lack of capitulation). While not yet confirmed without a buy signal (positive price action to follow), it's none the less a very exciting sign imo. It shows the network is regaining it's strength, and price will likely follow suit.

There seems like something is going to happen......

This I'm now starting to finally believe. The volitile price swings on lower time-frames between $18K and $20K is showing signs that's things are gearing up for a bigger move. Bears are casually shorting the price from $20K, but the bulls are yet again heavily defending $19K, irrespective of the short-term bearish price action. A buy signal with the hash ribbons indicator could really turns the tables imo.


The Daily RSI is now starting to trend upwards are finding support from oversold conditions, after previously struggling to find buyers when returning to bearish.



I still see $21K as strong resistance, but there's now an increasing chance that longer-term bullish momentum can over ride the short-term bearish sentiment.