Despite the price drops, Bitcoin has been this oversold since 2020 and now is struggling above $ 51,990
Last week, Bitcoin miners celebrated a new ATH. This week they celebrate its second-largest red candle. Bitcoin price has not been oversold since 2020.
BTC/USD 4-hour chart | Source: TradingView
Bitcoin price is near as oversold as in March 2020 after two red weeks
Bitcoin closed the week with its second-largest red candle in its entire history, testing a low near the $ 47,000 price zone after the ATH of $ 64,000 was recorded last week.
Overall, this has been a tough week for large-scale markets. From stocks to cryptocurrencies, traders went through a period of collective panic marked by rumors that Joe Biden would prepare a bill to raise capital gains tax by almost 100% for all. Who makes more than $ 1 million in profits.
This news caused the most important financial indices in the US and other countries to drop on a large scale. And the cryptocurrency has had an even worse response, with Bitcoin confirming a downtrend after breaking through the support of a channel initiated in late 2020.
Today’s decline places Bitcoin at $ 48,000 with as low as $ 47,044. For the first time, the 10-period moving average and the 55-period moving average are sloping down, which could indicate that the uptrend is weakening, at least temporarily.
Bitcoin has lost just over 5% in the last 24 hours and 13% in the previous 7 days. With nearly $ 8,000 lost, this would be the most significant total price drop in history, even though it has seen the worst drop in the price ratio. To put things in perspective, the $ 10 drop when Bitcoin was trading at $ 100 respectively worse than the $ 1,000 drop when Bitcoin was valued at $ 60,000.
The indicators showed that the traders have yet to recover from the panic wave of the previous days. Bitcoin has not been oversold since mid-March of last year when fears of a widespread crisis caused by the coronavirus pandemic pushed markets underground.
This means traders are now looking to exit their positions to increase their holdings of fiat, commodities, or even altcoins. The same sentiment expressed by the Crypto Fear & Greed Index, which is at its lowest in a year, suggests that investors’ fears of losing money with Bitcoin are no longer so strong. from the accident in March 2020.
However, the low RSI is generally a bullish sign. In theory, the market tends to reach equilibrium after such periods of excitement with the opposite correction.
You can see the BTC price here.
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