Key Takeaways:
- Bitcoin's RSI is approaching a crucial long-term position that could determine the fate of the bear market.
- A weekly bullish divergence is needed for a repeat of the early 2023 rally.
- One trader stated they are "not in a hurry" to re-enter the market, given it's only been months since the all-time high.
Bitcoin RSI: Watching Highs and Lows
Bear market bottoms for Bitcoin have typically coincided with the Relative Strength Index (RSI) beginning to print bullish divergences on the weekly timeframe.
Trader Jelle noted that current market behavior mirrors historical trends, suggesting Bitcoin's next turning point could be imminent.
"When the weekly RSI on $BTC makes higher lows again, it's time to pay attention," he wrote on the X platform.
A classic bullish divergence occurs when the RSI prints higher lows while the price simultaneously prints lower lows. However, Jelle indicated that there is still room for price to adjust and maintain the emerging recovery.
"Whether BTC makes higher lows, equal lows, or lower lows doesn't matter," he continued.
BTC/USD weekly chart with RSI data. Source: Jelle/X
BTC Price Bear Flag Continues
At the time, the importance of reclaiming the 200-week exponential moving average (EMA) as support was also discussed, a phenomenon that occurred in March 2023.
BTC/USD weekly chart with RSI and 200-week EMA. Source: Cointelegraph/TradingView
BTC/USD chart. Source: Jelle/X