"Bitcoin Enters Oversold Territory... Approaching Technical Opportunity Zone"

Bitcoin (BTC) has plunged in recent days to its lowest level in 7 months. As Bitcoin fell below a key psychological support level, bearish sentiment across the market intensified. However, major technical indicators suggest that a 'opportunity zone' is forming in the short term.

On the 20th (local time), BeInCrypto reported that the relative strength index (RSI) entered oversold territory for the first time in 9 months. The last time Bitcoin officially entered an oversold zone was in February, when after a short-term correction it soon rebounded.

Historically, oversold zones indicate the possibility of a rebound, but timing has varied each time. In February, the price fell about 10% further before a full recovery began. If the same pattern repeats, Bitcoin could be open toward around $77,164.

On-chain indicators are showing similar signals. Bitcoin's MVRV (market value divided by realized value) ratio is –14%, the lowest in the past three years. This means that a significant number of short-term holders have entered loss territory and is interpreted to mean the price is undervalued relative to historical averages.

Generally, when MVRV remains between –8% and –18%, market selling pressure has often become saturated. In the past, buying interest flowed in as accumulated selling fatigue eased within this zone, leading to gradual rebounds.

On the day, Bitcoin was trading on the Binance Tether (USDT) market at around $86,000, approximately 7% lower than the previous day. The support level is $85,204; if it does not hold, it could fall to $80,000.

Conversely, if it succeeds in rebounding from the current zone, whether it can break through $86,822 and then $89,800 will be key. If it surpasses those two price levels, there is also analysis that it could turn $91,521 into a support level and attempt to recover to the $95,000 range.