[Analysis] "Bitcoin RSI enters 'oversold' zone…possibility of a short-term rebound signal noted"

Suehyeon Lee

Summary

Bitcoin (BTC) has continued its recent decline and the RSI has fallen below 30, indicating oversold.
Analyst Omkar Godbole explained that the RSI entering oversold alone cannot be expected to produce an immediate rebound and may indicate strong downward momentum.
He said that in the past, when RSI signals were accompanied by support formation and easing selling pressure, short-term downtrends slowed, so these should be closely monitored.

Bitcoin (BTC) price has continued its decline, and technical indicators show an oversold signal, according to analysis.

On the 18th (local time), Omkar Godbole, a CoinDesk analyst, said, "Bitcoin has been pushed below $90,000, and the 14-day Relative Strength Index (RSI) has fallen below 30," adding, "This reflects a weakening of price momentum and entry into oversold territory, which suggests a short-term slowing of the downtrend or the possibility of a technical rebound."

However, Godbole explained, "One should not expect an immediate rebound solely because the RSI has entered oversold. The indicator can remain in that area for an extended period and often indicates strong downward momentum instead." He said the RSI signal functions as evidence for a rebound only if accompanied by support zone formation, candlestick patterns such as doji candles and long lower wicks.

He added, "In February this year, when the RSI fell below 30, BTC's short-term downtrend eased, and later it formed a bottom around $75,000 in early April," and "Since a similar phase could recur now, it is necessary to closely observe support formation and signals of easing selling pressure."

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