Bitcoin Triggers Weekly Oversold Signal for First Time Since June 2022

BlockBeats News, February 5th, according to TradingView data, as the price fell below $71,000, Bitcoin triggered a weekly RSI oversold signal for the first time since June 2022, now at 29.21.

RSI stands for Relative Strength Index, which is one of the most commonly used technical analysis indicators in financial markets such as stocks, futures, forex, and cryptocurrencies. It was proposed by the American technical analysis master J. Welles Wilder in 1978 and is mainly used to measure the speed and magnitude of price changes, determine whether the market is overbought or oversold, and help investors find potential reversal or trend continuation signals. Normally, when the RSI value drops below 30, it enters the oversold zone.

An RSI oversold signal does not necessarily mean that the price is at an absolute low point. In June 2022, Bitcoin once dropped below $18,000, with an RSI value of about 26.2 at that time. In November of the same year, during the FTX flash crash event, Bitcoin plummeted to $15,600, but the RSI value was 31.4, showing a divergence from the June low (meaning the price made a new low, but selling pressure eased).