Bitcoin’s current performance suggests it may soon experience a big price rebound. According to Julien Bittel, head of macro research at Global Macro Investor, Bitcoin’s price often goes up after its Relative Strength Index (RSI) drops below 30.
Bittel shared a chart showing Bitcoin’s price movements during the last five times its RSI went below 30. He also disagreed with the popular belief that Bitcoin’s price follows a four-year cycle connected to its halving events.
What is RSI? Is Bitcoin Oversold?
Relative Strength Index, or RSI, is a tool that helps experts understand if an asset like Bitcoin is overbought or oversold. It works on a scale from 0 to 100:
- A score below 30 means the asset is oversold or undervalued. This often signals it might rise soon.
- A score above 70 means the asset is overbought or overvalued. This may mean its price could fall.
RSI is calculated by comparing recent price gains versus losses over a certain period, usually 14 days. For example, a high number of recent losses might push the RSI below 30.
Bitcoin’s RSI on the weekly chart is now just below 37, based on TradingView data. While it hasn’t reached oversold territory yet, it is getting close. The last time Bitcoin’s RSI dropped this low was back in December 2022 during a bear market. At that time, Bitcoin’s price was around $16,500.
After hitting this low RSI point in 2022, Bitcoin’s price surged dramatically. Over the next 2.5 years, it soared by 660%, reaching an all-time high this October. This shows that oversold RSI levels often lead to big rallies.
Bittel shared another chart showing Bitcoin’s average price path after the RSI score drops below 30. He noted that previous patterns have been accurate and often led to higher prices.
“Here’s an updated look at the trajectory Bitcoin typically follows after an oversold RSI reading,” he shared via Twitter. “So far, it’s been pretty spot on.”
Could the Current Cycle Last Longer?
Bittel also predicts that Bitcoin’s current bull market cycle might extend into 2026. A bull market cycle is a period when prices are generally rising. He believes this longer cycle is influenced by factors such as government actions and financial trends rather than the traditional four-year halving pattern.
The Bitcoin halving event happens roughly every four years and reduces the reward miners get, which limits the supply of new Bitcoin. Learn more about Bitcoin Halving.
Bittel explained that past four-year cycles were not driven by halving events but by government refinancing cycles. These cycles deal with debt repayment timelines. He also noted how post-COVID policies, like increased government spending, shifted this cycle forward by one year.
Why Oversold Levels Matter
The idea that oversold levels lead to price rebounds is also supported by experts at the crypto research platform Milk Road.
“Oversold signals in Bitcoin don’t exist in a bubble—they relate to wider factors like global liquidity and economic cycles,” they said. Liquidity refers to how easily assets can be traded without affecting the price. When liquidity improves, oversold dips often turn into upward trends over time.
However, they also warned people not to assume every price drop is the start of a new bear market. A bear market is when asset prices are falling over an extended period. Instead, Milk Road analysts believe that current economic conditions support the idea of an extended cycle lasting until 2026.
The Current Bitcoin Market
Despite hopeful long-term predictions, Bitcoin’s short-term performance hasn’t been strong recently. Over the past week, Bitcoin’s price went down by 4.2%. At the time of writing, Bitcoin costs around $86,600.
Still, experts like Bittel believe that Bitcoin’s RSI nearing oversold territory is a good sign for future growth.