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Bitcoin’s Relative Strength Index (RSI) is approaching oversold territory, a level that has historically been the starting point for strong bullish waves.
Julian Beitel, director of macroeconomic research at Global Macro Investor, said that Bitcoin price behavior after the RSI falls below the 30 level is often followed by a significant rebound.
Data provided by Bitttle shows Bitcoin’s average price action over the past five times when the RSI fell below 30, indicating that the market tended to recover almost every time.
He also rejected the idea of four cycles related to mining reward distribution, arguing that it is a simplistic explanation that does not reflect the true driving forces of the market.
The RSI indicator is used to measure momentum and determine whether an asset is overbought or oversold on a scale of 0 to 100.
Readings below 30 usually indicate overbought and a possible rebound, while readings above 70 usually indicate overbought and a possible pullback.
Currently, Bitcoin’s weekly RSI is just below 37, which means it is close to oversold territory.
This level was last recorded at the bear market bottom in December 2022 when prices were around $16,500, before rising by more than 660% in about two and a half years.
Bittel also believes that the bull cycle is still likely to continue into 2026, based on his analysis of business cycles, financial conditions and global liquidity levels.
He confirmed that the so-called Quad cycle was not essentially about the breakup but about the government debt refinancing cycle, which was misaligned by about a year as a result of post-pandemic financial policy.
This view is supported by Milk Road macroeconomic analysts, who emphasize that short-term oversold signals should be interpreted in the context of liquidity and the business cycle.
They explain that improving conditions and continued inflows into the market tend to make these temporary dips tend to rise in the medium term, even if such moves are characterized by volatility.
On the other hand, short-term performance remains relatively weak, with Bitcoin prices down about 4.2% over the past week and currently trading around the $83,500 level.
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