Bitcoin Oversold Condition Signals Bearish Trend, Analysts Caution
Crypto analyst Quinten noted that Bitcoin is currently in oversold levels. However, Dr. Cat argues this situation is bearish rather than bullish. He stated that entering oversold levels indicates extreme bearish price action, leading to increased selling among investors.
Key Points on Oversold Conditions
- Oscillators remain between 0 and 100 but Bitcoin's price can move lower or higher.
- In prior bull markets, Bitcoin was typically in overbought territory.
- Buying in oversold conditions on a lower timeframe is viable only if the higher timeframe is bullish.
- Many altcoins are also oversold and could trend toward zero.
- In bear markets, oversold conditions may persist without substantial recovery.
Dr. Cat emphasized that misconceptions exist regarding oversold and overbought conditions concerning RSI. Additionally, CryptoQuant CEO Ki Young Ju reported that Bitcoin’s supply currently exceeds demand, further supporting the bearish outlook. This is evidenced by significant profit-taking from whales, who sold over 29,000 BTC since April 9.
The current Bitcoin price is around $84,600, reflecting a decline over the past 24 hours.
