Bitcoin (BTC) is showing signs of a potential rebound following a sharp sell-off that rocked the entire cryptocurrency market. Analysts are pointing to a combination of technical indicators and historical patterns as reasons to remain optimistic about the digital asset’s future performance.
In particular, crypto analyst by the pseudonym El crypto prof, in an X post on August 20 pointed out that the recent Bitcoin sell-off has pushed the Relative Strength Index (RSI) to its lowest level in over 20 months, indicating a potential oversold condition.
Bitcoin price analysis chart. Source: TradingView
The analyst noted that Bitcoin’s price had reached a crucial support line that had previously acted as a resistance for nearly a year. What’s particularly noteworthy is the historical correlation between BTC’s RSI dipping below 30 and subsequent price movements.
Bitcoin seven-day price chart. Source: Finbold
A summary of the asset’s technical analysis obtained from TradingView suggests a ‘sell’ sentiment score of 14, which is in line with the 13 from the moving averages. Oscillators are indicating a ‘buy’ sentiment score of 6.
Bitcoin technical analysis chart. Source: TradingView
It’s important to note that apart from the historical chart pattern, the value of Bitcoin is also susceptible to a range of factors, including macroeconomic trends and regulatory developments.
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