Bitcoin’s recent oversold reading indicates the cryptocurrency could consolidate near $60,000 before the next meaningful rally takes hold.
Earlier this month, bitcoin’s 14-day Relative Strength Index (RSI) dipped below 30 for only the third time in its history, according to Checkonchain. The RSI measures momentum by comparing average gains and losses over a 14-day period. Readings above 70 typically signal overbought conditions, while readings below 30 suggest oversold territory, implying that selling pressure may be exhausted. Notably, bitcoin has not reached extreme overbought RSI levels since December 2024, when it first surpassed $100,000.
Historically, dips below 30 have coincided with cycle lows. In January 2015, the RSI fell to around 28 as bitcoin traded near $200, triggering roughly eight months of sideways consolidation before a sustained rally. A similar pattern appeared in December 2018, when the RSI fell below 30 near $3,500, followed by about three months of accumulation before prices moved higher.
Bitcoin is currently trading near $66,000, with market sentiment remaining in “fear” or “extreme fear” territory on the Crypto Fear & Greed Index for most of the past month. Since its October peak, the cryptocurrency has declined more than 50%, briefly testing the $60,000 region.
If historical trends repeat, the current oversold RSI suggests bitcoin may spend the coming months consolidating around $60,000 before embarking on its next upward leg.
