Bitcoin analyst eyes ‘V-shape’ BTC price bounce as RSI hits 5-year low

Bitcoin (BTC) stayed stubbornly anti-trend on Aug. 22 as $26,000 turned a magnet for intraday BTC value motion.

BTC value “dying chop” returns

Information from Cointelegraph Markets Pro and TradingView tracked a 3rd day of sideways efficiency on BTC/USD.

Regardless of being closely oversold in accordance with relative energy index (RSI) readings, Bitcoin refused to supply any type of restoration bounce from ranges final seen two months prior.

Market individuals have been stressed, with common dealer Jelle referring to intraday movements because the “dying chop.”

“At this stage it seems like a recreation of hen to see who’s going to make a transfer to interrupt the chop,” monitoring useful resource Materials Indicators continued.

Analyzing liquidity on the Binance BTC/USD order e-book, Materials Indicators famous a broad lack of liquidity, rising the potential for a pointy transfer in both route.

“The market is ready to see if extra bid or extra ask liquidity goes to be interested in the vary,” it explained to X subscribers.

“Thus far, we’re seeing small quantities of bid liquidity ladder up from $20k nearer to the lively buying and selling zone, however no liquidity of any measurement (new or moved) has been stacked into the vary defending value from a Decrease Low.”

The implications have been nonetheless potentially very serious for bulls, with a decrease low (LL) apt to danger even $20,000 help going ahead.

“For sure, printing a LL on this TF has macro implications. Printing 2 LLs would push BTC right down to sub $20k ranges,” Materials Indicators concluded.

RSI strengthens “V-shape restoration” thesis

Zooming out, hope remained that Bitcoin may rescue its total uptrend.

Associated: Bitcoin is in ‘new bull cycle’ — Metric that bottomed before 70% gains

In a devoted YouTube update on the day, Michaël van de Poppe, founder and CEO of buying and selling agency Eight, famous the closely oversold alerts being generated by RSI.

On 12-hour timeframes, RSI measured lower than 19 on the time of writing — close to its lowest ranges for the reason that 2018 bear market backside. Day by day ranges have been comparable, reaching their lowest for the reason that March 2020 COVID-19 cross-market crash.

“Each time we see such a transfer, you get a kind of V-shape restoration again up, and it finds an equilibrium on a better flooring,” Van de Poppe mentioned about earlier BTC value flash crashes.

He added that it was “very probably” that Bitcoin may stage a comeback to deal with $26,500 or extra subsequent.

“Present Bitcoin value motion jogs my memory of September 2020 — simply earlier than the beginning of the earlier bull market,” Jelle in the meantime suggested alongside a comparative chart.

“Absorption and slowly grind greater right here for some time — and I may see this play out equally.”

This text doesn’t comprise funding recommendation or suggestions. Each funding and buying and selling transfer includes danger, and readers ought to conduct their very own analysis when making a call.