Analyst and trader Ali Martinez suggests that Bitcoin (BTC) is signaling a bullish trend as it hovers around the levels seen in early May, when it was at its flagship cryptocurrency.
Martinez tells his 65,300 followers on social media platform X that over the past two years, whenever the Relative Strength Index (RSI) indicator on the daily chart dipped into the “oversold zone,” Bitcoin surged by at least 60%.
RSI is a momentum oscillator used to determine whether an asset is oversold or overbought. It ranges from 0 to 100, with levels between 70 and 100 indicating overbought conditions and levels between 0 and 30 indicating oversold conditions.
Martinez emphasizes that Bitcoin’s daily RSI reached oversold levels in August 2023, subsequently surging by nearly 200% from around $25,000 to reach a new all-time high of over $73,000.
“With BTC now below $62,000 and RSI once again in the oversold zone, this may be an excellent opportunity to buy the dip!”
Source: Ali Martinez/X
At the time of writing, Bitcoin is trading at $61,827.
Martinez also notes that the Market Value to Realized Value (MVRV) ratio for Bitcoin suggests that the flagship cryptocurrency may appreciate as it falls into negative territory. MVRV compares the current market value of Bitcoin to its realized capitalization (calculated based on the price at which Bitcoin was purchased). When the MVRV ratio falls below zero, it indicates oversold conditions.
“Since February 2023, the Bitcoin MVRV ratio has dropped below -8.40% four times, triggering price increases of 63%, 100%, 92%, and 28%.
Currently, with BTC priced below $60,000 and an MVRV ratio of -8.96%, this may be an ideal time to buy the dip!”
Source: Ali Martinez/X
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