Rate RSI Signals Bitcoin Bear-Market Bottom Around $87,000
On-Chain Mind reports that Bitcoin’s rate-relative strength index (rate RSI) has plunged into single-digit readings on the 3-day chart, a rare "oversold" condition historically associated with bear-market bottoms (notably in 2018 and mid‑2022). The indicator fell below the 10/100 level, suggesting a major cyclical reset and signaling that a long-term bottom could be forming near roughly $87,000. Meanwhile, Alphractal CEO Joao Wedson flagged an atypical behavior in the BTC long/short ratio: it has remained at unusually high levels for an extended period, producing false bottom signals through November while price continued to fall. Wedson warns that eager retail longs attempting to bottom‑fish could be targeted by large players who push prices lower to liquidate those positions. The article notes divergence among indicators—rate RSI points to a potential bottom while the long/short ratio and recent price action introduce downside risk. No investment advice is given.
Neutral
The news is neutral because it contains mixed signals. The rate RSI reading at historically oversold levels is a classic technical indicator that has preceded major BTC bottoms (2018, mid‑2022), which supports a contrarian bullish case for a forming long-term bottom around ~$87k. However, the persistent, unusually high long/short ratio and recent false‑bottoms through November imply that market structure remains fragile and that liquidity-seeking moves by large players could drive further downside. For traders, that translates into heightened uncertainty: the indicator suggests limited downside from a cyclical perspective, encouraging cautious accumulation or long-term positioning, while the long/short behavior warns against aggressive leveraged longs and favors risk-managed entries, tighter stops, or waiting for confirmation (e.g., price stabilization, decreasing long/short ratio, or RSI divergence on shorter timeframes). Historically, similar mixes of oversold momentum and misleading bottom signals have produced volatile chop before a durable trend reversal. Short-term: elevated risk of whipsaw and liquidations. Long-term: potential base formation if on-chain momentum exhaustion holds and macro/liquidity conditions stabilize.